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Agenda 11/18/2014 Item # 11DRecommendation to 1) consider and accept the report and presentation by AECOM Technical Services, Inc. regarding oil exploration /production in Collier County; 2) approve recommendations for the development of new state regulations to be presented, in coordination with Florida Department of Environmental Protection, to the Legislative Delegation. 3) direct the County Attorney's office and County Manager or his designee to develop zoning code changes including, but not limited to, a potential Conditional Use process for oil exploration /production wells that are within an identified distance to residential areas. OBJECTIVE: To provide the Board of County Commissioners (Board) with the results of AECOM Technical Services Inc.'s assessment of oil well drilling in Collier County and have the Board provide direction to the County Manager or his designee to forward to the County's legislative delegation the Board's recommendations addressing potential legislative changes to existing State oil well regulations and to have the County Attorney's office and County Manager or his designee to develop zoning code changes including, but not limited to, a potential Conditional Use process for oil exploration /production wells that are within an identified distance to residential areas. CONSIDERATIONS: On September 9, 2014, as a result of ongoing issues concerning environmental impacts arising from oil exploration /production in Collier County and resulting litigation, the Board approved a work order for AECOM to work with staff to develop a technical report (Attachment l) and presentation (Attachment 2). The report and presentation include a high level risk assessment of the potential impacts of oil exploration /production in Collier County, identification of the responsibilities of the various regulatory agencies, evaluation of existing regulations, and recommendations on how such regulations could be improved. The review was coordinated internally between representatives from the Growth Management Division and the Public Utilities Division, and externally with representatives from Collier Resources and the Conservancy. Mike Bennett, P.G. will provide a summary presentation addressing the Board's direction. His qualifications are listed in Attachment 3. On September 9, 2014, the Board approved a motion to direct the Chairman to write a letter to Collier County's legislative delegation to advocate, in conjunction with the Florida Department of Environmental Protection (FDEP), the development of new legislation and strengthening existing regulations on oil well drilling in Florida. At the request of Secretary Vinyard, (Attachment 7) staff has prepared recommendations for the 2015 legislative delegation. During the October 14, 2014 meeting, Item 12B, the Board approved entering into a stipulation agreement (Attachment 4) with the FDEP to jointly develop and support regulatory reforms in this industry. The stipulation agreement specified that the FDEP will seek additional legislative authority to further strengthen the State's existing oil program regulations and confirms that this commitment covers all current oil well technologies, including the activities, technologies and processes engaged in by the Dan A. Hughes Company at the Collier -Hogan well site, including but not limited to, those commonly referred to by the public as fracking or acid fracking. The FDEP further agreed that it will actively seek out, engage and work with all of the stakeholders in Collier County with respect to proposed legislative and regulatory changes, including but not Packet Page -650- 11/18/2014 11.D. limited to Collier County, the Collier County Water -Sewer District, The Conservancy, Collier Resources Company, as well as any other affected land owners. On October 28, 2014, Item l l C, the Board approved the list of Collier County 2015 State Legislative Priorities (Attachment 5). Number one on the list, Inland Oil Drilling and Fracking, requested assistance from the Collier County Legislative Delegation to support legislation that improves and strengthens State rules and regulations governing oil well drilling activities. The Inland Oil Drilling and Fracking item was approved with the understanding that recommendations from the Board's consultant for the development of the new state rules and regulations for oil well drilling activities would also be considered by the Board at its next meeting for approval and subsequently included in the proposed legislation. The recommendations developed by AECOM and staff (Attachment 6) are provided for the Board's consideration and address construction standards and operational practices for oil and gas development /production. During a presentation at the September 9, 2014 Board meeting, the FDEP discussed strengthening their authority without encroaching on zoning at the local level. The Growth Management Plan (GMP) is specific in that any application for an oil well is not reviewed at the local level from an environmental perspective. Policy 1.1.6 of the Conservation and Coastal Management Element states, "In those areas of Collier County where oil extraction and related processing is an allowable use, such use is subject to applicable state and federal oil and gas permits and Collier County non - environmental site development plan review procedures." Essentially this review is done by the FDEP and duplicative reviews are not encouraged by the GMP. However, both the GMP and the Land Development Code (LDC) specify where oil wells and oil field development are permitted within the various GMP districts and LDC zoning districts and the process an application needs to satisfy to gain approval. For certain districts an application for an oil well is required to go through an administrative process, which requires the submittal of a Site Development Plan, to gain approval and, in other districts, an oil well is required to go through the conditional use process, which requires a public hearing to gain approval. After a thorough review with interested parties and AECOM, staff has formulated recommendations that can be grouped into three general categories: Enhanced Construction Standards, Enhanced Oversight /On -site Inspection Practices, and potentially a more robust Conditional Use Process. Provided to the Legislative Delegation in Attachment 6 are recommendations that address Enhanced Construction Standards and Enhanced Oversight/On- site Inspection Practices that will require State action. Staff is also recommending that the Board consider a more robust Conditional Use Process at the local level and consider providing direction to the County Attorney and Countv Manager or his designee to review local zoning requirements, especially expanding the conditional use provision for activities within close proximity to residential areas, and provide the Board recommended changes at a future Board meeting. FISCAL IMPACT: There is no fiscal impact associated with this Executive Summary. Packet Page -651- 11 /18/2014 11. D. LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, raises no legal issues at this time, and requires majority vote for approval. -JAK GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this Executive Summary. RECOMMENDATION: That the Board (1) accept the report and presentation by AECOM regarding oil exploration /production in Collier County; (2) approve the recommendations for the development of new state regulations to be presented, in coordination with FDEP, to the Legislative Delegation; and 3) direct the County Attorney's office and County Manager or his designee to develop zoning code changes including, but not limited to, a potential Conditional Use process for oil exploration /production wells that are within an identified distance to residential areas. Prepared by: Danette Kinaszczuk, Pollution Control Manager, Engineering & Natural Resources Department Attachments: 1. AECOM Technical Report 2. AECOM Presentation 3. Michael Bennett, P.G. Qualifications 4. Stipulation Agreement 5. Legislative Priorities List Recommendations for New State Legislation for Construction and Oversight Standards Meeting Minutes - October 9, 2014 Packet Page -652- COLLIER COUNTY Board of County Commissioners Item Number: 11.11.D. 11/18/2014 11. D. Item Summary: Recommendation to 1) consider and accept the report and presentation by AECOM Technical Services, Inc. regarding oil exploration /production in Collier County; 2) approve recommendations for the development of new state regulations to be presented to the Legislative Delegation Public Meeting and Hearing on December 4, 2014; and 3) direct the County Attorney "s office and County Manager or his designee to develop zoning code changes including, but not limited to, a potential Conditional Use process for oil exploration /production wells that are within an identified distance to residential areas. Meeting Date: 11/18/2014 Prepared By Name: PuigJudy Title: Operations Analyst, Community Development & Environmental Services 11/7/2014 11:57:555 AM Submitted by Title: Manager - Pollution Control, Pollution Control Name: Danette Kinaszczuk 1 1/7/2014 1 1:57:56 AM Approved By Name: CasalanguidaNick Title: Administrator - Growth Management Div, Business Management & Budget Office Date: l 1 /10/2014 12:17:07 PM Name: KlatzkowJeff Title: County Attorney, Date: 1 1 /12/2014 11:22:04 AM Name: OchsLeo Title: County Manager, County Managers Office Date: I 1/] 2/2014 11:44:22 AM Packet Page -653- 11 /18/2014 11. D. Packet Page -654- 11/18/201411.[l. Submitted to Submitted by A��OM Collier County AECOK8 Growth Mano ont[Xx 4415 Metro Parkway 2885S. Horseshoe Dr. Suite 404 Nap|au, FL 34101 Fort Myers, FL 33916 November 2014 AZCOM collier County 11 /18/2014 11. D. Table of Contents 1 Introduction ..................................................................................................................................... ............................1 -1 1.1 Purpose .................................................................................................................................... ............................1 -1 1.2 Scope ....................................................................................................................................... ............................1 -1 2 Oil Production in Collier County ..................................................................................................... ............................2 -1 2.1 Oil Production for the Sunniland Trend ....................................................................................... ............................2 -1 2.2 Vertical Production Wells ........................................................................................................... ............................2 -4 2.3 Horizontal Production Wells ....................................................................................................... ............................2 -4 2.4 Hydraulic Fracturing ............................................................................................................... ............................... 2 -8 2.5 Acid Stimulation Techniques ................................................................................................. ............................... 2 -11 2.6 Acid Fracturing ......................................................................................................................... ...........................2 -12 2.7 Economic Benefits of Oil and Gas Production ........................................................................ ............................... 2 -13 2.8 Summary of Ground Water Resource of Collier County ......................................................... ............................... 2 -14 3 Regulations Related to Oil and Gas Development in Florida .......................................................... ............................3 -1 3.1 Safe Drinking Water Act (SDWA, 1974) ................................................................................... ............................... 3 -1 3.2 Resources Conservation and Recovery Act (RCRA) (Public Law 94 -580) ................................ ............................... 3 -1 3.3 Clean Water Act (CWA 1972) ................................................................................................. ............................... 3 -2 3.4 The Fracturing Responsibility and Awareness of Chemicals (FRAC) Act .................................. ............................... 3 -3 3.5 State of Florida Regulations .................................................................................................... ............................... 3 -3 4 Summary of Potential Impacts and Recommended Action Items .................................................. ............................4 -1 4.1 Potential Impacts to Water Resources Related to Oil and Gas Activities in Collier County ............ ............................4 -1 4.2 Hogan - Collier 20 -3H Well Stimulation ........................................................................................ ............................4 -7 4.3 Water Resource and Aquifer Protection Action Items .................................................................. ............................4 -9 List of Figures Figure 2 -1. Map of Active and Inactive Oil Fields within the Sunniland Trends in South Florida (Source: Applegate & Pontigo, 1984) ................................... ............................................................................................................................................. 2 -1 Figure 2 -2. Geologic Column Showing the Various Geologic Units and Position of Oil Producing Horizons (Source: Pollastro et. al., 2001) .................................... .............................................................................. .................................................... 2 -3 Figure 2 -3. Production Area between a Vertical and Horizontal Well Completion ..................................... ............................2 -6 Figure 2 -4. General Composition of Fluids used during Hydraulic Fracturing Operations ......................... ............................2 -9 Figure 2 -5. Example of Potential Fracture Development along a Horizontal Well Segment ..................... ...........................2 -10 Figure 2 -6. Conductive Channel Development due to Matrix Acidizing (Source: MPG Petroleum) ........................ .............. 2 -12 Figure 2 -7. Summary of the Geologic Formations and Hydrogeologic Units underlying Collier County (Source: Reese, 1998) 2- 15 Figure 4 -1. Geologic and Hydrogeologic Units underlying Southwest Florida .......................................... ............................4 -2 Figure 4 -2. Map showing the Location of Public Water Supply Wellfields and Oil Wells completed in the Sunniland Trend (Source: Collier County Growth Management Division) ........................................................................... ............................4 -5 O &G Technical Report Packet Page - 656 - November, 2014 AXOM Collier County 11 /18/2014 11. D. 1 Introduction 1.1 Purpose The purpose of this Technical Report is to provide a summary of Oil and Gas development within the South Florida Basin known as the Sunniland Trend and how drilling and well stimulation practices, including those associated with the Collier -Hogan 20 -31-1 oil well may impact the ground water resources of Collier County. 1.2 Scope Collier County has retained the services of AECOM Technical Services Inc., to provide technical and consulting services associated with identifying potential environmental impacts of the oil exploration /production industry within Collier County. Tasks under this assignment include: • Review pertinent information including reports, permits, correspondence, and other documents from Collier County, the Conservancy of Southwest Florida, Collier Resources Company, Dan A. Hughes Company, L.P., the Florida Department of Environmental Protection (FDEP), and other entities. • Review the current regulations related to Oil and Gas exploration and production in Florida including Chapter 377 Part 1 of the Florida Statues and Chapters 62C -25 through 62C -30 of the Florida Administrative Code (F.A.C). • Complete a Technical Summary Report of Oil and Gas activities within Collier County, which includes the following items: 1. A summary of oil and gas development within the Sunniland Trend. 2. Description of the local typical historical drilling practices and how those compare to directional drilling and hydraulic fracturing operations, noting the differences between the various methods. 3. Details of the geology /stratigraphy /hydrogeology within Collier County and its vulnerability for contamination related to Oil and Gas operations. 4. High level risk assessment related to oil exploration /production industry impacts to the Collier County's groundwater, surface water and localized natural resources. O &G Technical Report Packet Page -657- November, 2014 A COM Collier County 11 /18/2014 11. D. 5. Summary of the responsibilities for the different regulatory agencies, to include Collier County, FDEP, Environmental Protection Agency (EPA), and any other regulatory agencies. 6. Recommendations for Oil and Gas state legislative initiatives. O &G Technical Report Packet Page -658- November, 2014 aCOM Collier County 11 /18/2014 11. D. 2 Oil Production in Collier County 2.1 Oil Production for the Sunniland Trend The Sunniland Trend is primarily composed of late Cretaceous age (approximately 120 million years ago), carbonate and anhydrite rock units that contain discrete oil- bearing units. It is located on the northeast flank of the South Florida Basin and extends for about 145 miles from Lehigh Park Field in Lee County to the Forty -Mile Bend Field in Dade County. The width of the Sunniland Trend is estimated to be 20 miles with 14 named discoveries made since the first discovery at the Sunniland Field by the Humble Oil Company Gulf Coast Realties Well No.1 in 1943 (see Figure 2 -1). The depth of production from the Sunniland Formation is between 11,300 to 12,000 feet. Over the past 70 years the cumulative crude oil production from eight commercial oil fields in the Sunniland Trend are in excess of 120 million barrels (Pollastro, 2001). Figure 2 -1. Map of Active and Inactive Oil Fields within the Sunniland Trends in South Florida (Source: Applegate & Pontigo, 1984) 27° N 26" N 82° W 81 °w chi0h Park Field West- Sunoco Folds Field Townsend Canal Field Mid- Sunoco Folds Field -f,�,* •,• Sunoco Folds Field ` Corkscrew Field s�4fh F /prra,• IF% ,- Lake Trafford Field Sominole Field aSy J Sunnlland Field •°Bear Island Field Legend Active Oil Field Inactive Oil Field Sunniland Trend Counties N A 0 10 20 40 Kilometers i, i. \��" - "'– Pepper Hammock Field - --`_Baxtor Island Field 1111— Raccoon Point Field Forty Mile Bend Field 82° W 81' W 27` N 26` N O &G Technical Report Packet Page -659- November, 2014 AXOM Collier County 11 /18/2014 11. D. The oil produced is a moderately low gravity (25 to 28 degrees) and low gas content due to the oil being generated near the low temperature limit for oil production (Applegate and Pontigo, 1984). The chemical composition of the hydrocarbon depends on several factors: the nature of the original organic material, the amount of pressure (deeper burial means higher pressure), the temperature (deeper burial means higher temperature), and the length of time the rock is buried (usually measured in millions of years). The combining of organic matter with the higher subsurface pressure and temperatures between 140 °F and 320 °F for a few million years is needed to make crude oil. Natural gas requires a slightly higher temperature of 212 °F to 392 °F (Flaherty and Flaherty, 2014). In the Sunniland Trend, the subsurface temperatures range from 97 °F to 265 °F with an average temperature of 184 °F, therefore minimal natural gas (methane) is present (Pollastro, 2001). The source for oil generation is deposits of organic matter within the carbonate units in the lower Sunniland Formation. Once the oil was generated it migrated to a short horizontal range to low relief organic mounds that possessed good porosity and permeability. Production within the Lake Trafford Field is believed to be from fracture porosity referred to as the "Rubble Zone" due to its likelihood to fracture when cored. The oil producing units are overlain by very low porosity and permeability limestone that is approximately 50 feet thick — this unit acts as an overlying seal that trapped and held the oil in place within the Lake Trafford Field (Applegate and Pontigo, 1984). The majority of oil production from the Sunniland Trend comes from carbonate rock units of the upper Sunniland Formation that is approximately 100 feet in thickness that overlies the Lake Trafford producing units mentioned above. These producing units within the upper Sunniland Formation produce heavy marginally mature varieties of crude oil from porous bio- clastic debris mounds termed "rudistids" banks and pods that have good porosity and permeability, which grade into non - porous limestone that provides a lateral seal (Pollastro, 2001). Figure 2 -2 provides a summary of the oil producing horizons of the Sunniland Trend. These localized geologic conditions within the Sunniland Formation provided good reservoir properties for oil to accumulate and overlying seals that held it in place over geologic time. The Sunniland Formation and its oil producing units are overlain by the Lake Trafford Formation, which was previously named the "Upper Massive Anhydrite ". This unit acts as a seal "caprock" to the underlying hydrocarbon producing units and consists of non - porous gray colored limestone and anhydrite beds. This thick sequence of carbonate (limestone) and evaporate (anhydrite) units that range in thickness from 7,000 to 8,000 feet have effectively sealed the oil bearing units along the 0 &G Technical Report Packet Page -660- November, 2014 A=TOM Collier County 11 /18/2014 11. D. Sunniland Trend from the overlying brackish and freshwater aquifers present from land surface to an approximate depth of 1,800 feet below land surface (Applegate and Pontigo, 1984). Figure 2 -2. Geologic Column Showing the Various Geologic Units and Position of Oil Producing Horizons (Source: Pollastro et. al., 2001) ti 1W �I i STRATIGRAPHIG UNIT tapproximMVtNr,.enassl LITHOLOGY 1995 USGS PLAY NUMBER � I `—; i.-- Holocene - Paleocene � Gmuptat& ddrxnh�,' w j -5,500 fI) erorddte i C'= I W Pine Key Formation � cnxlkvamx,twre. kd 1- 3,000ft) n,a dGlomw, ! Corkscrew swamp m� Formation ttt m Ql Rookery Pay " Pa ther Gamv f onnatlon a I� p(iiia, Bay Fonuaaon ! Gat dot) Pass Fonnanon C/) M I m 7 W—r—c—o unotlon o Formation V RatllC nake Hammock'' *L Founaoon Lake Trafford cc FUIMMICn �,•w..:r,:: :I end5Da7a c: Sunniland rormdzion ,r.6=6- O ° ` Punta Garda Anhydrite ,_. �� nr+q.anc� .a,l Able Member c = 1 Twelve Mlle n+avri • 5004 Member Shale fvtember + � �I Pumpkin Flay Formation 5004 A Oil Producing Horizons within the Sunniland Formation referenced above O &G Technical Report Packet Page -661- November, 2014 Pone Island Formation j Wood River Formation sd } .% rmwmx 5006 lS01j j f`J .'y U'M;ox�4 drmKe Laiompe � ".tnae : w,e far. ervot, w ks a a„dl._,.__... nmomne jai rocks QA un uaa rocks M-1-1 ;,, nnFgrpran � uaaei Gaxucc � _, Cwmansata ? y�r'�'s".: O &G Technical Report Packet Page -661- November, 2014 A COM Collier County 11 /18/2014 11. D. 2.2 Vertical Production Wells Until the 1970s, most oil wells were vertical and used when the target reservoir is directly beneath the surface hole (starting location). For vertical drilling, the drill bit is attached to the end of a length of hollow steel drill pipe. During drilling operations the drill bit and drill pipe, referred to as the drill string, is rotated clockwise using an above ground motor. As drilling proceeds, the bit cuts away small pieces of rock (referred to as cuttings). The rotating action plus the weight of the drill string forces the drill bit deeper into the rock and causes a continuous vertical borehole to form. As a well is drilled, fluids (commonly referred to as drilling mud) are pumped down the center of the hollow drill pipe and pushed through openings in the drill bit. From there, the drilling mud is pushed up the hole along the outside of the drill pipe to land surface. The drilling mud is used to carry the pulverized rock pieces to the land surface where they are removed from the fluid, thereby keeping the borehole clean and enabling drilling to progress faster and easier. This process continues until the well reaches the pre- determined depth or "casing point ". At this depth the drill pipe is removed from the well and replaced with a steel casing. The installed steel casing is permanently cemented in place within the borehole to seal -off various water bearing formations and to protect shallow groundwater from contamination by deeper geologic intervals containing saline groundwater or petroleum. The cement is pumped down the center of the hollow casing to the bottom of the casing and forced back up the well alongside the outer surface of the casing referred to as the annulus. After the cement is allowed to harden for a specified time (12 or 24 hours) or to a compressive strength, drilling is resumed by entering the cased drill hole with a drill string of smaller diameter than the inner diameter of the casing. This provides for a "telescoping effect' of successively smaller vertical borehole and casing sizes. The vertical well is drilled until all target formations have been penetrated. Once this pre - determined depth (referred to as total depth) is reached, the drill string is removed from the well and the final steel casing is installed and cemented in place. Once the production casing has been installed at the final depth, it is perforated to allow fluids to flow into the well, cleaned, and placed into service (Bourgoyne et. al., 1991). 2.3 Horizontal Production Wells Historical records suggest that horizontal drilling dates back to 1929. It was first used in Pennsylvania in 1944. It became common practice during the 1980s when improved equipment and technology were further developed. Advances in drilling sensors and global positioning technology over the last 10 years helped to make improvements in the implementation of directional drilling technology, thus reducing costs, which in turn allows exploration and production companies to employ the horizontal 08G Technical Report Packet Page -662- November, 2014 A COM Collier County 11 /18/2014 11. D. drilling method more economically. This has resulted in an increase in the use of horizontal drilling techniques world -wide. Data compiled in 2000 indicated that 23,385 horizontal wells were completed world -wide with 10,966 completed within the United States. Horizontal drilling is currently considered a standard well configuration and completion method for oil and gas wells (Curtis, 2011). A horizontal well consists of both vertical and horizontal components. The vertical section of a horizontal well follows the same telescoping design of using multiple casings and cement to seal -off the overlying water bearing units. However, while drilling a horizontal well, the drill bit is detached from the drill pipe and is replaced with a bottom -hole motorized bit as the well approaches the kick -off point (where the well changes from vertical to horizontal). From here to the landing point (end of the horizontal segment of the well), only the bit is rotated because it can be accurately controlled. Drillers continue to use the steerable bottom -hole motor to drill the remainder of the horizontal portion (referred to as a lateral) of the borehole. Once the horizontal segment of the wellbore is completed, it is cleaned by circulating the drilling fluid to remove all rock debris from the borehole, then the final completion components of well are installed (Bellary, 2009). The fluid used during drilling operations is circulated back to surface tanks where it can be cleaned and continuously used to complete the drilling of the wellbore. Once the well is completed, the drilling fluid can be cleaned and reused to drill another well, disposed of at an industrial wastewater treatment plant or injected into the subsurface via a Class 11 injection well. Once the final string of steel casing or the production tubing (steel casing used to convey oil or gas to the surface) and packer (mechanical seals used to isolate specified segments of the lateral) are installed within the horizontal (lateral) segment of the wellbore through the reservoir where oil or gas production is anticipated; explosive charges known as shots are lowered down the production casing using a perforation gun that is attached to a wireline. The perforation gun is positioned at specified depth where the shots are detonated, creating perforations (holes) in the production casing over a specified depth within the reservoir. These perforations provide openings, a hydraulic connection, to the reservoir to allow the hydrocarbons to enter the production string. The production casing and perforations are cleaned -out by circulating (pumping at a high rate) a completion fluid (that may consist of water, potassium salts and polymers) through the production casing and back to holding tanks at land surface. This removes any debris that remains in the perforations and residual drilling fluids. The residual drilling fluids may reduce the hydraulic properties within the borehole surrounding the final (production) casing. During work -over operations, the debris from the perforations and residual drilling O &G Technical Report Packet Page -663- November, 2014 a[OM Collier County 11 /18/2014 11. D. fluids are effectively removed. After the work -over is completed, the well can be placed into production. If damage (invasion of solid particles that clog /block the pores or fractures near the wellbore) to the formation caused by drilling and cementing operations occurs additional well stimulation may be required. Well stimulation may include circulating a brine solution and polymers or organic /inorganic acid solution (acid wash) to remove the damage caused by drilling operations from the wellbore to increase the well's oil production capacity (Bellarby, 2009). The advantage of using horizontal drilling technology allows the production interval to intercept a larger cross - sectional area of the oil reservoir to increase production from each well. Take for example a reservoir that is 50 feet thick that extends laterally in all directions, a vertical well drilled and completed into this 50 foot reservoir using 4.5 inch production tubing would have a production area of 119 ft2 compared to a horizontal well consisting of a 3,000 foot lateral would have a surface area of 7,070 ft2. The horizontal well can be completed above the oil /water contact (most petroleum reservoirs contain water and oil) to more effectively drain the oil and minimize water production from the reservoir. This increased exposure of the reservoir is one of the largest advantages that horizontal wells have over vertical wells. Overall development of a reservoir could require four or more vertical wells compared to one horizontal well to produce the same amount of oil or gas. The area of the oil producing capabilities from a vertical as compared to a horizontal well is shown in Figure 2 -3. In addition, horizontal wells cause less surface disturbances resulting from the construction of well pads, roads, and pipeline with several horizontal wells placed on a single well pad decreasing the impact to the surrounding area (Arthur et al. 2008). Figure 2 -3. Production Area between a Vertical and Horizontal Well Completion O &G Technical Report Packet Page -664- November, 2014 aGOM Collier County 11 /18/2014 11. D. In southwest Florida, approximately 30 horizontal wells have been permitted since 1992 to access the broad oil and gas reservoirs within the Sunniland Trend. The FDEP also encourages the use of directional or horizontal drilling to avoid sensitive surface locations and minimize surface impacts However, there has been no documented comparison between horizontal versus vertical completion methods for this area (FDEP website: Oil and Gas 101 — http: / /www.dep.state.fl.us /water /mines /oil gas /index.htm. Potential Risks of horizontal compared to vertical wells include: • Greater amount of fluids are needed during well completion and well stimulation because of the longer horizontal completion intervals, which cause the handling and disposal of larger volume of flowback water and chemicals overall. • Use of multi -stage hydraulic fracturing, (if performed) completed at higher pressure may increase the potential risk of failure in the production tubing or the cement surrounding the production casing. • Effective cement isolation of the annulus on the radial portion of the well because of the difficulties to maintain the annular space. The quality of cement placed around this section of the well can be evaluated using various type of wire -line logging tool. Potential actions to address risks specific to horizontal wells: • Perform appropriate logging techniques (cement bond log) to evaluate the annular cement on the production casing, especially within the radial portion of the production casing. • Conduct mechanical integrity tests (temperature and noise surveys) to confirm external mechanical integrity of the production casings during the well construction phase. • Conduct pressure tests on the production casing or tubing to withstand the maximum pressure expected during work -over activities and witnessed by FDEP staff. • Require trained and experienced inspectors onsite to ensure well construction & testing plans are being followed and standards are met. O &G Technical Report Packet Page -665- November, 2014 A COM Collier County 11 /18/2014 11. D. 2.4 Hydraulic Fracturing Hydraulic Fracturing (HF) is used when a reservoir unit does not have sufficient permeability to transmit hydrocarbons to a production well. The permeability of the rock unit holding the oil and gas dictates whether the reservoir should be hydraulically fractured. If the permeability of an oil reservoir is 50 millidarcies (md) or greater or 1 and to 5 and for a gas zone, hydraulic fracturing is generally not necessary to establish an economic flow rate. However, if these criteria are not met or the wellbore is damaged during drilling or completion operations, hydraulic fracturing is then used to artificially enhance the permeability of the reservoir rock in close proximity of the wellbore by creating openings or interconnected pathways in the rock for easier flow of oil and gas into the well to produce commercial quantities of oil and gas. HF operations are expensive to complete and are purposefully designed taking into consideration specific engineering properties of the target formation (thickness of the unit, elastic properties of the reservoir — how easily the rock will fracture, and rock stresses) to optimize the development of a network of fractures while ensuring that fracture development is limited to the target formation so not to adversely affect the overlying seal of the reservoir or the production well casing material. During HF operations, fractures are created by pumping large quantities of fluids (approximately 1 to 5 million gallons per well) at high pressure (greater than the fracture pressure of the rock unit) down the production casing or tubing and into the target rock formation. The fracturing fluid is generally a proprietary mixture consisting of approximately 98% water and sand with the remaining 2% or less, of chemical additives, each having a specific function to effectively transmit the fluid and sand into the rock formation (Veatch et al., 2004). Figure 2 -4 shows the general composition of fluids used during hydraulic fracturing operations. O &G Technical Report Packet Page -666- November, 2014 A OM Collier County 11 /18/2014 11. D. Figure 2 -4. General Composition of Fluids used during Hydraulic Fracturing Operations Acid :. Removes near well damage Hydrochloric acid _ .. ......... ...... __.......... Biocide ...................__._......_. _.........._....._ Controls bacterial growth ...... _,.......__.: Glutaraloehvde Breaker Delays breakdown of the Ammonium persuffate geirng agent Corrosion inhibitor Prevent coroson of pip` ......... .... ..... .............................._ Nh- d.metho fcrmam:de Crosslini,er Maintains fluid viscosity ,..._ .. Borate salts :_ ..................._ .......................................... as temperature increases Friction reducers ...... ... ........ 6ecrsases pumping fncuon ..............._..............: Pe- vacryl —de Gafling agents Improves proppant placement Guar gum KCI Creates a brine carrier fuic I'masslum chionde Oxygen scavenger :..... .............. ...... Prevents corrosion of well tubulars .......... Ammonium bmulfte ....... pH adjusting agent ... .._... ........ .... ._._............... Adjusts the pH of fluid to maintain the ..... _...,. _.... .. .. Sodiun carbonate :. _ ................._....,..._.... eitectmeness cf other components ._. ............ Seale inhibitor ----- ..--- .--- ._.... Prevents scale deposits in the pipe ._ .. ... .. _. _..... ... ..__..: Ethylene glycol Surfactant Wintrnicurg "gent I.W'openol Souxer, DenaRRNnt o` Energy and Groundwater - ,wecton Cmnctk. Hydraulic fracturing produces a break in the rock to release the pressure applied to the rock at the wellbore. The crack that develops is narrow, usually 2 to 3 mm in width (1 /10th to 1 /8th inch) and grows outward from the wellbore widening slightly until a barrier is encountered or there is sufficient migration of fluids (leak off) into side fractures or adjoining pore system that dissipates the energy (pressure). Even at an injection rate of 100 barrels per minute (4,200 gallons per minute), the secondary fractures and permeable units will soon absorb enough liquid from the main fracture to limit outward and upward fracture growth (King, 2012). These artificially induced fractures can increase the permeability of a reservoir by 100 to 1,000 times. The propping agent (referred to as a proppant) used during HF operations consist of quartz sand, ceramic pellets or other small incompressible particles. The fluids flow into the rock unit under high pressure causing it to fracture, the proppant is conveyed into the fractures and fluids are then permitted to flow back into the well, while the proppant remains behind, propping the fractures open. The process of perforating, HF, and flowing the well can be repeated until all the potentially productive units transected by the well have been hydraulically fractured. Hydraulic fracturing operations in horizontal wells are conducted along the cased lateral (horizontal portion) that may extend several thousand feet where various intervals are selected to be perforated and fractured. Starting with the farthest end of the lateral wellbore, each group of perforations, or stage, is hydraulically fractured and then isolated from the rest of the untreated well with a plug. After all 08G Technical Report Packet Page -667- November, 2014 A COM Collier County 11 /18/2014 11. D. stages have been hydraulically fractured, the plugs are removed and the well is flushed and allowed to flow back to surface under controlled conditions to remove the treated water and debris from the fractures. Figure 2 -5 shows an example of fracture development in a horizontal well. Figure 2 -5. Example of Potential Fracture Development along a Horizontal Well Segment If the procedure is successful, the transmitting capacity of the reservoir is increased and the petroleum well responds by producing higher volumes of oil with less pressure loss within the production tubing than measured before hydraulic fracturing operations. Of course, higher volumes of oil and gas translate into greater economic benefit from the well. After HF operations are completed, 10- to 40- percent of the fluid flows back to the surface (Ohio Department of Natural Resources website). The HF fluid that remains in the reservoir returns to the surface during normal production operations over a period of several months to years. The flow back water contains the chemicals used in the HF process and can also collect other naturally occurring substances such as trace metals, naturally occurring radioactive material (NORM), or volatile organic compounds from the reservoir rock and fluids. The flow back fluid can be managed by either recycling for additional HF operations, treatment via wastewater treatment plants or injection into the subsurface using Class II wells. Contrary to FDEP's September 9, 2014 presentation to the BOCC, the FDEP's Oil & Gas website indicates that hydraulic fracturing on oil and gas wells has occurred within the state, with the last hydraulic fracturing on record conducted in the Jay oilfield in Northwest Florida in 2003. Although some conventional hydraulic fracturing operations have been conducted in the past in Florida's oilfields, the FDEP reported that oilfields within the Sunniland Trend produce from carbonate rocks that are not ideal 0 &G Technical Report Packet Page -668- November, 2014 A COM Collier County 11/18/2014 11. D. targets for HF compared to the development of natural gas from shale formations which are the prime target of conventional hydraulic fracturing in other states. However, there are various reservoirs within the Sunniland Trend that produce from the "Rubble" limestone (naturally fractured limestone units) such as the Lake Trafford Field where production could be enhanced by hydraulic fracturing operations. A study by the American Petroleum Institute (API) of 19 oil and gas basins within the United States was conducted to determine the probability for the contamination of an underground source of drinking water (USDW), assuming a well is used for injection simulating hydraulic fracturing instead of its intended use in oil /gas production. The study concluded a number of independent events must occur simultaneously and go undetected for contamination to occur. These events include simultaneous leaks in the production tubing and packers, production casing, [intermediate casing], and the surface casing coupled with upward movement of water in the borehole past other salt water aquifers (where inflows would probably occur first) to reach a USDW. The API report indicates that the potential for groundwater to be impacted by injection (hydraulic fracturing) is low. It is expected that the probability for groundwater to be impacted by the pumping of fluids during hydraulic fracture operations conducted on newly installed wells accompanied by high level of monitoring while being performed would have a probability of less than one well in every 200,000 wells drilled (Michie & Associates. 1989). 2.5 Acid Stimulation Techniques Acidizing predates hydraulic fracturing and all other well simulation techniques, with the first acid treatment of an oil well occurring in 1895 (Kalfayan, 2008). During this operation, concentrated hydrochloric acid was used to stimulate a well producing from carbonate formations, similar to those in Southwest Florida, which increased the production capacity of the well. There are two general types of acid stimulation methods; acid washing and matrix acidizing. In acid washing the objective is to simply clean the production tubing and wellbore. Acid simulation of the formation is not intended and most often used only to remove mineral scale and other debris restricting flow to the well. In matrix acidizing, the acid is pumped in at, or slightly above the reservoir pressure not exceeding the formation's fracture pressure. This method is designed to remove or dissolve material in the formation pore network near the wellbore that was caused by drilling or well completion operations or the material that is plugging the perforations of the production casing /tubing. Removal of the acid dissolvable material allows increased flow to the well. Similar processes are used to acidize potable water wells. In homogeneous carbonate formations, this method works by dissolving material to form conductive O &G Technical Report Packet Page -669- November, 2014 A=COM Collier County 11 /18/2014 11. D. channels ( "wormhole ") proximal to the wellbore. The nature of the connective channels that develop during matrix acidizing depend on injection rate, downhole temperature, and how the acid interacts with the rock formation. This type of acid treatment can more than double the production rates of the well (Kalfayan, 2008). Figure 2 -6 shows and example of conductive channels that develop during matrix acidizing. Figure 2 -6. Conductive Channel Development due to Matrix Acidizing (Source: MPG Petroleum) 2.6 Acid Fracturing Acid fracturing operations related to oil production from carbonate reservoirs occurred during the mid to late 1930s', the first noted report of acid fracturing operations occurred in 1935. During this acid injection operation, the "lifting pressure" (fracture pressure) was obtained indicating that the formation was being fractured. In acid fracturing, an acid (typically 15% hydrochloric acid) is injected into the formation at a pressure greater than the fracture pressure of the reservoir to create fractures using a viscous fluid (pad) or the acid itself. As the acid travels through the induced fractures it interacts and dissolves the wall of the fracture increasing their width and length. Once the acid is spent (no longer reactive), it along with the undissolved residual material (quartz sand) is flushed from the well. The acid fracturing can be repeated in multiple stages to increase the conductivity of the previously developed fractures or initiate new fractures in the reservoir (Kalfayan, 2008). There is little difference between hydraulic and acid fracturing operations. Hydraulic fracturing uses water and sand (plus other chemicals) to increase gas /oil production in low permeability shale or coal seam or naturally fractured limestone reservoirs similar to the Lake Trafford Field. During hydraulic fracturing a large volume of water is pumped under high pressure to create fractures, then the propping agent (quartz sand) is introduced to keep the newly created fractures or natural fractures open once the O &G Technical Report Packet Page -670- November, 2014 A COM Collier County 11/18/2014 11.D. downhole pressure is reduced to normal /operating reservoir pressure. Acid fracturing is primarily used on relatively homogeneous carbonate (limestone) reservoirs where gelled acid is pumped at high pressure to create and then etch the fractures to increase their width and length. A propping agent is generally not used in acid fracturing operations. The purpose of either hydraulic or acid fracturing method is to induce fractures under controlled conditions within the reservoir mainly proximal to the wellbore to increase the well's production capacity whether it is completed as a vertical or horizontal well. Modified methods of hydraulic fracturing can also be used to open and support natural fractures that may close during long term oil production due to a reduction in pore pressure within the reservoir. Hydraulic or acid fracturing has been used in over one million wells in the United States for more than 60 years, and has been used to retrieve more than 7 billion barrels of oil and over 600 trillion cubic feet of natural gas (Institute for Energy Research, 2011). There are currently no regulations banning hydraulic or acid fracturing operations or requiring chemical disclosure of products used during hydraulic fracturing operations in the State of Florida. 2.7 Economic Benefits of Oil and Gas Production In 2011, the US oil and natural gas industry's total employment impact to the national economy, combining the operational and capital investment impacts, amounted to 9.8 million full -time and part - time jobs and accounted for 5.6 percent of total US employment. At the national level, each direct job in the oil and natural gas industry supported approximately 2.8 jobs elsewhere in the US economy in 2011. Counting direct, indirect, and induced impacts, the industry's total impact on labor income (including proprietors' income) was $598 billion or 6.3 percent of the national labor income in 2011. The industry's total impact on US GDP was $1.2 trillion, accounting for 8.0 percent of the national total in 2011 (Price Waterhouse Cooper, July 2013). In Florida, the oil and gas industry employed 286,800 people accounting for 2.9% of the state's total employment with a labor income of $12.9 billion representing 2.8% of the state's total labor income in 2011. As a percent of the state's economy, the oil and natural gas industry's total value -added impact from its operations in Florida in 2011 totaled $23.2 billion or 3.1 % of the total (Price Waterhouse Cooper, July 2013). O &G Technical Report Packet Page -671- November, 2014 ACOM Collier County 11/18/2014 11. D. 2.8 Summary of Ground Water Resource of Collier County Three major aquifer systems underlie Collier County to a depth of approximately 3,400 feet below land surface which includes the Surficial Aquifer System (SAS), the Intermediate Aquifer System (IAS), and the Floridan Aquifer System (FAS). A summary of the geologic formations and hydrogeologic units underlying Collier County is provided in Figure 2 -7. The SAS sediments consist of unconsolidated very fine to coarse grained quartz sands, and shell fragments within a lime mud matrix. The Tamiami Formation is composed of hard limestone, with minor fine - grained quartz sands with moderate to good permeability. These units form the Lower Tamiami aquifer. This aquifer provides the bulk of the productive capacity of this system and serves as a source for public and private water supplies and irrigation in the County. Low permeability sediments (marls) underlie the productive limestone units and form an inter- aquifer confining unit. Below this confining unit are moderately hard limestone units with various amounts of quartz sand that continues to the base of the SAS. Below the SAS lies the IAS. It consists of the Peace River and Arcadia Formations of Hawthorn Group (Scott, 1988), which acts as semi - confining units separating the Floridan aquifer from the SAS. However, in southwest Florida, the IAS contains multiple productive horizons, separated by low permeability inter - aquifer confining units. The productive units form the Sandstone; mid - Hawthorn and lower Hawthorn aquifers, which are used for irrigation, potable water supply and for aquifer storage and recovery (ASR) systems within Collier County. O &G Technical Report Packet Page -672- November, 2014 A COM Collier County 11 /18/2014 11. D. Figure 2 -7. Summary of the Geologic Formations and Hydrogeologic Units underlying Collier County (Source: Reese, 1998) The FAS consists of a series of Tertiary age (23 to 56 million years ago) limestone and dolomite units that extends from approximately 700 to 3,400 feet below land surface. The system includes the lower Arcadia Formation, Suwannee and Ocala Limestone, Avon Park Formation, and Oldsmar Formation. The Paleocene age (56 to 66 million years ago) Cedar Keys Formation consisting of low permeability evaporitic gypsum and anhydrite units' form the Sub Floridan Confining Unit, the lower boundary of the FAS (Miller, 1986). The top of the FAS coincides with the top of a vertically continuous permeable limestone sequence below the IAS. The upper Floridan aquifer is artesian in nature and consists of thin, high permeability water bearing horizons interspersed within thick, confining units of the Suwannee and Ocala Limestone, and the Avon Park Formation. The uppermost permeable zones that contain brackish water typically lie between 700 and 1,400 feet below sea level. To meet future water supply demands, the upper Floridan O&G Technical Report Packet Page -673- November, 2014 Approximate Series Geologic thickness Lithology Hydrogeologic unit Approximate Unit (feet) thickness (feet) UNDIFFERENTIATED 0-70 Quarrr sand, silt clay, and WATER -TABLE HOLOCENE shell a AQUIFER 20-100 Silt, sandy clay, micritic TO h CONFINING BEDS 0-60 TAMIA.MI limestone, sandy, Shelly x PLIOCENE FORMATION 0 -175 limestone, calcereous sand- 5 LOWER TAMIAMI stone. and quartz sand 01 AQUIFER 25 -160 M, PEACE Interbedded sand, silt, ��+ CONFINING UNIT 20-100 SANDSTONE 0-100 O RIVER 50-400 gravel, clay, carbonate, a MIOCENE x C7 FORMATION and phosphatic sand L AQUIFER AND LATE z <- CONFINING UMT 10 -250 OLIGOCENE x" Sandy limestone, shell beds, MID-HAWTHORN 0 -130 AKCADIA dolomite, phosphatic sand w_ CONFINING UNIT 1001100 FORMATION 400 -550 and carbonate, sand, silt, X and Clay LOWER HAWTHORN 0-300 PRODUCING ZONE EARLY SUWANNEE Fossiliferous, calcarertitic OLIGOCENE LIMESTONE 0-600 limestone UPPER 700 -1,200 FLORIDAN AQUIFER OCALA Chalky to fossiliferous, < LIMESTONE �� calcatenitic limestone EOCE NE a < MIDDLE CONFINING 500 -800 c AVON PARK FORMATION 900 1,200 Fine - grained, micritic to o fossiliferous limestone, UNIT r OLDSMAR 1,400 -1,800 dolomitic limestone, dense x FORMATION 800-1,400 dolomite, and sum gypsum a o LOWER FLORIDAN BOULDER 400 j AQUIFER I ZONE 500-700 Dolomite and dolomitic PALEOCENE CEDAR KEYS limestone 1,200 ? Massive anhydrite. beds SUB- FLORIDAN 1 0�� FORMATION CONFINING UNIT The FAS consists of a series of Tertiary age (23 to 56 million years ago) limestone and dolomite units that extends from approximately 700 to 3,400 feet below land surface. The system includes the lower Arcadia Formation, Suwannee and Ocala Limestone, Avon Park Formation, and Oldsmar Formation. The Paleocene age (56 to 66 million years ago) Cedar Keys Formation consisting of low permeability evaporitic gypsum and anhydrite units' form the Sub Floridan Confining Unit, the lower boundary of the FAS (Miller, 1986). The top of the FAS coincides with the top of a vertically continuous permeable limestone sequence below the IAS. The upper Floridan aquifer is artesian in nature and consists of thin, high permeability water bearing horizons interspersed within thick, confining units of the Suwannee and Ocala Limestone, and the Avon Park Formation. The uppermost permeable zones that contain brackish water typically lie between 700 and 1,400 feet below sea level. To meet future water supply demands, the upper Floridan O&G Technical Report Packet Page -673- November, 2014 AXOM Collier County 11 /18/2014 11. D. aquifer can be developed as a brackish potable water supply source for Reverse Osmosis (RO) treatment plants and for aquifer storage and recovery. Low permeable limestone units form the middle confining unit, which separates the brackish water in the Upper Floridan from the saline water present in the lower Floridan aquifer. The base of the USDW where the salinity of the ground water is less than 10,000 mg /L of total dissolved solids ranges in depth from 900 feet near Marco Island to more than 2,100 feet in the eastern part of the County (Reese, 1998). Below the middle confining unit is the lower Floridan aquifer that is characterized by thin, moderate to high permeability, fractured, and cavernous units separated by low permeability limestone units. These highly permeable units in the lower part of the lower Floridan aquifer form the "Boulder zone" which is used primarily for the disposal of non - hazardous from water reclamation facilities, water treatment plants, brine concentrate from RO plants and oil field exploration and production waste disposed of using Class II wells. The Boulder Zone underlying Collier County occurs from approximately 2,300 to 3,400 feet in depth (Reese, 2008) and contains saline water similar in composition to sea water. The base of the Floridan aquifer coincides with the low permeability anhydrite units within the Cedar Keys Formation. Below the base of the Floridan aquifer, the permeability is extremely limited and the water quality is saline or hyper - saline within the underlying Paleocene and Cretaceous aged sedimentary rock units which precludes these units from future ground water development. O &G Technical Report Packet Page -674- November, 2014 AXOM Collier County 11 /18/2014 11. D. 3 Regulations Related to Oil and Gas Development in Florida 3.1 Safe Drinking Water Act (SDWA, 1974) The U.S. Environmental Protection Agency's (EPA) central authority to protect the nation's drinking water is drawn from the Safe Drinking Water Act (SDWA). The protection of Underground Sources of Drinking Water (USDW) is focused in the Underground Injection Control (UIC) program, which regulates the subsurface emplacement of fluid. Congress provided for exclusions to UIC authority (SDWA § 1421(d)), and added by the Energy Policy Act of 2005, which includes language shown below related to subsurface injection of fluids generated in the exploration and production of hydrocarbons and geothermal. "The term 'underground injection' refers to the subsurface emplacement of fluids by well injection; and excludes the underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities." Thus the Energy Policy Act (2005) excludes hydraulic fracturing operations and resulting waste products from regulation under the UIC program. 3.2 Resources Conservation and Recovery Act (RCRA) (Public Law 94 -580) In December 1978, EPA proposed hazardous waste management standards that include reduced requirements for several types of large volume wastes. Generally, EPA believed these large volume "special wastes" are lower in toxicity than other wastes being regulated such as hazardous waste under RCRA. Subsequently, Congress exempted these wastes from the RCRA Subtitle C hazardous waste regulations pending a study and regulatory determination by EPA. Among the wastes covered in the 1978 proposal were "gas and oil drilling muds and oil production brines." The oil and gas exemption was expanded in the 1980 legislative amendments of RCRA to include "drilling fluids, produced water, and other wastes associated with the exploration, development, or production of crude oil or natural gas. . . ." (EPA website). In 1988, EPA issued a regulatory determination stating that control of Exploration & Production (E &P) wastes generated by the Oil & Gas Sector under RCRA Subtitle C regulations is not warranted. Therefore, E &P wastes remained exempt from Subtitle C Hazardous waste regulations. However, RCRA Subtitle C does not indicate the hazard potential of the exempted waste. In general, the exempt status of an E &P waste from RCRA Subtitle C OSG Technical Report Packet Page -675- November, 2014 AMOM Collier County 11 /18/2014 11. D. depends on how the material was used or generated as waste during oil and gas exploration and production operations, not necessarily whether the waste material is actually hazardous or toxic. The RCRA Subtitle C exemption, however, did not preclude these wastes from control under state regulations, under the less stringent non - hazardous solid waste regulations under RCRA Subtitle D, or under other federal regulations (U.S. EPA's Publication October, 2002). RCRA, Subtitle D regulates the management of nonhazardous solid waste. It establishes minimum federal technical standards and guidelines for state solid waste plans in order to promote environmentally sound management of solid waste. Subtitle D regulates various types of nonhazardous waste. Two that are pertinent to E &P waste products and not regulated under Subtitle C are: • Nonhazardous industrial wastes (e.g., manufacturing process wastewaters and non - wastewater sludge and solids). • Other discarded materials, including solid, semisolid, liquid, or contained gaseous materials resulting from industrial and commercial activities, (e.g., mining waste, oil and gas waste, construction and demolition debris, medical waste, agricultural waste, household hazardous waste). 3.3 Clean Water Act (CWA 1972) Disposal of treated flowback generated by hydraulic /acid fracturing operations into surface waters of the United States is regulated by the National Pollutant Discharge Elimination System (NPDES) permit program under the Clean Water Act. Direct discharges from unconventional oil and gas extraction are subject to NPDES permit regulations, (40 CFR Parts 122 through 125), however there are currently no NPDES permits issued in Collier County related to oil and gas discharges. Waste and ground water protection requirements typically originate at the state level (often implementing federal statues) for exploration and production operations. Water discharge requirements are generally federal requirements, and air quality regulations are a mixture of state and federal requirements. O&G Technical Report Packet Page -676- November, 2014 A.=COM Collier County 11 /18/2014 11. D. 3.4 The Fracturing Responsibility and Awareness of Chemicals (FRAC) Act The Fracturing Responsibility and Awareness of Chemicals (FRAC) Act proposes to remove the exemption for hydraulic fracturing under the Safe Drinking Water Act (SDWA). The 2005 Energy Policy Act amended SDWA to exempt drilling technology involving underground fluid injection, except for diesel -based fracturing fluids. Under the FRAC Act, EPA would set the relevant standard, but enable states to integrate fracturing into current permitting processes, without the need for additional procedures. This is the third time that the FRAC Act has been introduced in Congress since it was first proposed in 2008, but it has never made it out of committee. The current bill (H. R. 1921) was assigned to a congressional committee on May 9, 2013, which will consider it before possibly sending it on to the House or Senate. This bill (H.R.1921) has a 5% chance of getting past committee with a 2% chance of being enacted as reported by Govtrack website (https: / /www.govtrack.us /congress /bills/113/hr1921). The Energy Policy Act of 2005, which was an omnibus energy bill that had among the provisions of the bill the so- called "Halliburton loophole ", exempted hydraulic fracturing from protections under the Clean Water Act, Safe Drinking Water Act, and CERCLA, which means that hydraulic fracturing is not regulated at the federal level. States where hydraulic fracturing operations occur have developed regulations to better regulate how and where these waste products are handled, treated and /or disposed of through legislative action. 3.5 State of Florida Regulations The Oil and Gas Program (Chapter 377, Florida Statutes and Rules 62C -25 through 62C -30, Florida Administrative Code) is the permitting authority within the FDEP's Mining and Minerals Regulation Program. Companies interested in exploration or production of hydrocarbons in Florida are regulated by the Oil and Gas Program. Primary responsibilities of this program include conservation of oil and gas resources, correlative rights protection, maintenance of health and human safety, and environmental protection. These concerns are addressed through a system of permits and field inspections. Chapter 377 F.S. provides two restrictions to where oil and gas permits can be issued. First, Chapter 377.24(5) specifies that no permit to drill a gas or oil well shall be granted within the corporate limits of any municipality, unless the governing authority of the municipality shall have first duly approved the application for such permit by resolution. Second Chapter 377.24 (6) states that no permit to drill a gas or oil well shall be granted at a location in the tidal waters of the state, abutting or immediately adjacent O &G Technical Report Packet Page - 677 - November, 2014 ACOM collier County 11/18/2014 11.D. to the corporate limits of a municipality or within three miles of such corporate limits extending from the line of mean high tide. The Environmental Resource Permit (ERP) program is implemented through a statewide rule, Chapter 62 -330, F.A.0 In southwest Florida, the South Florida Water Management District (SFWMD) issues an ERP that is required before beginning any land use or construction activity that could affect wetlands, alter surface water flows or contribute to water pollution. An ERP covers activities such as dredging and filling in wetlands, constructing flood protection facilities, providing storm water containment and treatment, site grading, building dams or reservoirs and other activities affecting state waters which are not generally relevant to site development related to Oil and Gas activities. Collier County's Growth Management Plan (GMP) is specific in that any application for an oil well is not reviewed at the local level from an environmental perspective. Policy 1.1.6 of the Conservation and Coastal Management Element states, "In those areas of Collier County where oil extraction and related processing is an allowable use, such use is subject to applicable state and federal oil and gas permits and Collier County non - environmental site development plan review procedures." Essentially this review is done by the FDEP and duplicative reviews are not encouraged by the GMP. Although the LDC currently limits where Oil Wells and Oil Field Development are permitted within the various GMP districts and LDC zoning areas; the limits are such that no conditional use permits for oil exploration or production have been issued to date. Other counties have more restrictive limits on Oil & Gas Development, for example, Lee County requires a special exception for exploratory oil wells and an additional exception to convert from an exploration well to a production well. O &G Technical Report Packet Page -678- November, 2014 AECOM Collier County 11 /18/2014 11. D. 4 Summary of Potential Impacts and Recommended Action Items 4.1 Potential Impacts to Water Resources Related to Oil and Gas Activities in Collier County As part of this study, Collier County staff identified specific areas of interest related to the potential for adverse effects to the water supplies as a result of oil and gas development in the County. The first question posed is the potential effects on various geologic layers between the oil production units within the Sunniland Trend and the base of the "Boulder Zone ". The sedimentary units above the Sunniland Trend consist of very low permeability gypsum, anhydrite, and limestone (chalk) units that range in thickness from 7,000 to 8,000 feet. These very low permeable units and apparent lack of geologic features such as fractures and faults (natural pathways) has provided an effective seal to the various reservoirs within the Sunniland Trend holding the oil in place over geologic time. Oil production over the last 70 years from the Sunniland trend has reduced the pressure within the reservoir to approximately 3,000 psi (value provided by Constega -Rover & Associates via email on 9.30.14). Also fluid levels in an oil well are estimated to be 6,000 feet below land surface (bls) (Collier Resource Meeting 9/22/14). Based on the above mentioned estimated fluid level in the Sunniland units; fluid levels in an oil production well would be approximately 2,600 feet below the base of the Boulder Zone at 3,400 feet bls. This difference in fluid levels causes a downward gradient between the reservoirs in the Sunniland Trend and the Boulder Zone. Therefore under static oil reservoir conditions there is an insufficient mechanism within the lower Sunniland reservoir to push fluids upward into the overlying Boulder Zone. Under hydraulic fracturing operations — the pressure (approximately 8,000 psi based on a fracture gradient of 0.7 psi /foot of depth) within the reservoir would provide a mechanism to move fluids upward within a limited distance from the wellbore. If an oil or exploratory well is installed in the same reservoir and was not properly plugged and abandoned (P /A) it could provide a potential pathway to the Boulder Zone. However, for upward fluid migration and contamination of the USDW to occur via improperly P/A oil or gas wells during hydraulic fracturing operations several factors would need to occur. First, the P/A well would need to be located within the area impacted by hydraulic fracturing operations. This area would be based on the volume of fracking fluid used, the pressure applied, and extent of fracture development. Secondly, the lowermost cement plug placed near the top of the oil production zone and the second cement plug located below the Boulder Zone, would have to be improperly installed, deteriorated, and /or have failed over time. The previously mentioned cement plug placements are based on past FDEP plug and abandonment requirements. If fluids migrated upward in a P/A well past O &G Technical Report Packet Page -679- November, 2014 AECOM Collier County 11 /18/2014 11. D. these two cement plugs into the Boulder Zone; it would cause limited impact to the Boulder Zone or overlying USDW because of the Boulder Zone's very high transmissivity would move the small volume of migrated fluids laterally and limit further upward fluid migration past the Boulder Zone. Qualitatively, the impact to the County's current use of the Boulder Zone as a disposal option for non- hazardous wastewater and RO concentrate would be low. The potential effects on upward migration of fluids from the Sunniland Trend under various scenarios could be quantified using analytical or computer models. Figure 4 -1 shows the vertical relationship between the oil producing horizons, the Boulder Zone and overlying brackish and freshwater aquifers. Figure 41. Geologic and Hydrogeologic Units underlying Southwest Florida WELL 86 ABANDONKI =N? LiTHOLOGY S7RATIGRAPHY HYOROGM —OGY DIAGRAM 0 -r5• u..., (c I Lu CEtIAEN PLUG' v 13 ry O eus aF c2 rg Z 9.525" ' w Dia. Y U Cas'n�. f� z w U 1,004 2.000 3,004 ;.040 r 5.G00 G,C04 w TOOL 0 8,G40 C 001' I0.C40 12,0100 PLUG' 5.5" Do . using c I� 0 U CEMENT RLUG � I Po Lt.NCOy and SVaScn auiry beio(s 3.54? iee! laser hers: MEL-hr:r- Tapu':p. HJ and E�tsciwirlappire�, A.Gt, ZG11, GzYarat on s! gv.. 3'.�nntland Fart^::ffon a' Souih Gbnda� '}•an Eons Gu?S west Assxiatioa r, /tea!eg�l 5ad»dav, e.53 p. 555 -9�5 O &G Technical Report Packet Page -680- November, 2014 �i' w Z 'La.(.�.'w:n1:'J'__�.�'2.._".r HAWTHORN GROUP I YT` .. sysTEn.+ SYSTEM ressa.lrear;.su SUWANEE LIMESTONE FrIF "rU [ -. 51 AVON PARK CC'nFIMNG > [CI'SY 32:L ;'~ IM rwmsuunmr r �cry -v zcn[5 I EN OaRE..A E P� l uUEar PS EBEF n M yov,1ps FORMATION � OLDSMAR FORMATION w,� E � FLLOURNI'D[ -Ap N d j �n AauIFrR ._ 4An 4t aF of.:t � M1 TN a `i! CEDAR KEYS FORMATION (.D — -= PINE KEY FORMATIDN Z LLL. Z j U Q 7 COR aORcV w`.a4F FGRh4ATl0ti Q tj Pnw , r'TF I ROOKERY BAY F0Ph4AT;0N "n,P PANTHER CAMP FORMATION M EkI DOLLAR SAY FOP. 4A_I0N' U) I G :)RDON PASS a 0RMA,10:`4 t't'1PCCJUN%TION FORMAT ON � � RAT71ESNAKEPA "vMDCK ��va FORMATION SJ1htLAde.M I PLUG' 5.5" Do . using c I� 0 U CEMENT RLUG � I Po Lt.NCOy and SVaScn auiry beio(s 3.54? iee! laser hers: MEL-hr:r- Tapu':p. HJ and E�tsciwirlappire�, A.Gt, ZG11, GzYarat on s! gv.. 3'.�nntland Fart^::ffon a' Souih Gbnda� '}•an Eons Gu?S west Assxiatioa r, /tea!eg�l 5ad»dav, e.53 p. 555 -9�5 O &G Technical Report Packet Page -680- November, 2014 AECOM Collier County 11 /18/2014 11. D. The second question posed was; what are the potential effects on the Avon Park Formation identified as a potential future water supply and the Upper Floridian - Ocala /Suwanee Limestone where Collier County and the City of Naples both have ASR wells completed to approximately 1,400 feet below land surface. Again, it is hypothesized that there would be minimal impact of fluid migration from the Sunniland trend on these brackish water units based on the significant thickness of low permeability anhydrite and limestone units and the static fluid level of the oil producing unit located 4,600 feet below these units. As mentioned above, the potential for upward movement of fluids during hydraulic fracturing operations via P/A wells would be low because the Boulder Zone would diffuse these fluids laterally instead of upward into the overlying units. Geochemical models can be used to determine the impact to the saline water within the Boulder Zone (determine the concentration of various chemical constituents), assuming a certain volume of fluid moved upward during hydraulic fracturing operations thru a P/A well. If hydraulic fracturing is not considered; the effects of abandoned oil wells before 1983 to the degradation of ground water quality in the upper Floridan aquifers needs to be considered further. Based on the placement of cement plugs in P/A oil wells prior to 1983, especially the lack of a cement plug above the Boulder Zone or near the base of the USDW may provide an opportunity for comingling of saline water from the lower Floridan aquifer with the brackish water of the upper Floridan aquifer. The potential impact of increased salinity on brackish water supply and ASR wells would depend on their lateral distance from these older P/A oil wells and the amount of drawdown associated with these well systems. Future planning efforts related to the development of brackish water supply or ASR systems should include a detailed area of review within the 20 year zone of influence to identify all P/A oil wells that may pose potential pathways for upward migration of saline water from the Lower Floridan aquifer into the proposed brackish water zones. Current plug and abandonment regulations for oil and gas wells now requires a 400 foot cement plug (200 feet above and below the USDW) to be installed as provided in 62C- 29.009 F.A.C. Also, 62C- 27.005 F.A.C. requires the surface casing to be set below the deepest USDW and be fully cemented to land surface. These current P/A regulations should minimize the potential of upward movement of saline water into the Avon Park and /or the upper Floridan aquifer. The third question posed was the potential effects of oil and gas production on the intermediate aquifer system (IAS). Based on a cursory review of the older P/A oil wells in Collier County — the information indicates that there is generally a cement plug located at the base of the surface casing that extends into the carbonate rock units of the upper Floridan aquifer (700 to 1,000 feet). If the surface casing extends through the IAS, is fully cemented to land surface with a cement plug placed at its base, and O &G Technical Report Packet Page -681- November, 2014 AECOM Collier County 11 /18/2014 11. D. then filled with heavy drilling fluid; the intermediate (mid - Hawthorn and Sandstone) aquifers would be isolated from upward migration of lower quality water from the upper Florida aquifer. However, in older P/A wells, if the cement plug was not installed at the base of surface casing or the surface casing was removed during P/A it would increase the potential for the brackish water from the upper Floridan to enter these permeable intermediate aquifers. Currently 62C- 27.005 F.A.C. requires surface casing for oil and gas wells to be set below the deepest USDW and cemented to the land surface, limiting ground water quality degradation while the well is in operation. When P /A, a cement plug is currently required at its base, then the remaining part of the casing would be filled with heavy drilling fluids. These measures would minimize the potential of upward migration of saline water into the IAS related to recently completed oil wells. Additional P/A requirements such as cementing any open -hole section above the Boulder Zone and thru the entire length of the surface casing (in lieu of placing heavy drilling fluid) would further reduce the potential for upward movement into the IAS. The fourth question posed was the potential effects on Collier County public water supply wellfields, private potable wells, and irrigation wells that withdraw water from the SAS. During past oil and gas well construction operations, a steel conductor casing was installed to a depth between 75 to 100 feet to seal -off the unconsolidated and permeable units within the surficial aquifer that allowed the longer length of surface casing to be installed and cemented to surface. Currently, during drilling and subsequent oil production, the SAS is protected by both the conductor and fully cemented surface casings. Currently 62C- 29.009 requires a 100 foot cement plug to be placed in the top of the largest string of casing cemented to the surface. The installed casings (surface and /or conductor) when constructed along with the P/A requirements should provide sufficient protection of the SAS during oil and gas development and production and after they are P /A. Figure 4 -2 shows the location of public water supply wellfields and their 20 year zone of influence in relation to oil wells drilled into the Sunniland Trend. P/A oil wells that do not meet current regulatory standards should be identified and brought up to current standards. Contamination risks to the surficial aquifer can also be a result of surface spills that may occur during drilling, work -over activities, and long -term production, storage, disposal and transportation of oil and produced water from active sites. O &G Technical Report Packet Page -682- November, 2014 AECOM Collier County 11/18/2014 11. D. Figure 4 -2. Map showing the Location of Public Water Supply Wellfields and Oil Wells completed in the Sunniland Trend (Source: Collier County Growth Management Division) C:rrvvrtn M�r.n,i�m�onl D�NS.en Oil Well Permits u '.COLLIER- HOGANN� 4G 29 4630,, 1 WELL z0.3H ! A� 3 • ! 4127 #' �t 47 29 c 47 30 0 1 ......; Dn Wen RE, I" 4 25 i� m ka�e RD+ 4933 1 49 s4 49 a2 j w ' L 4ti 1 e: :ge za ! 49 29 i 1 1 ! 50 # I 50 27 7 50 28 i 50 20 1 SO 30 j 6031 59 3;• 50_ j3 j 59 34 1 L Lepentl 11 2; ....�,�: #..- e...l..- ...,.. 1 1t • FOEP Partn{t entl Pre - Permit Oil Wells 1 5t 6 ,^ 5127 C 51 29 5t 29 5t 70 St 11 11 31 31 33 51 74 ' Status �'�('' d T Pn I Ab ndo tl. P h rer�.�hu: l^ f117 / __ I- ,,,,..,. -' C ; # .....« -,.. _... -..- i •.,...,- ..- ..i.._ «...�...s«.�l .,,.®.- ..�.- ..- ..�7.� -! �1F tl Plugl, dAb U ed PA1P1 }1 � i (( JJ •. SattW M D-', .Sall Wale [,--1 Shut to !4r 5225 i 5227 j 5228 5229 5230 5231 I 5272 j 5233• I "52N 1 +`Sall'W <lkSPr Pl pgedA U x -d rtl G D W (. 27 i.-. 53 28 n -� 53 29 59 30 it T 1 11 •N D I APE) ©P R4 U.a II ® U--v Pre-P WOi. Ol W011f e1tl ProtOellUn 2nnes ST/Yt sTna' -z ST 1t -3 T W -4 u�v t t +mre The fifth question posed was the potential contamination caused by surface level installations, equipment, etc., on the surface soils, surface water and wildlife. The natural surface at a site is protected by the construction of a compacted limestone pad that increases the working surface several feet above normal ground and surface water levels, which provides a level of containment and protective barrier if spillage occurs. An oil spill from an oil well completed in the Sunniland Trend is most likely to occur during production (under artificial lift conditions) because under normal reservoir pressure fluid levels are well below land surface. Potential contamination risk factors are associated with storage or transport of chemical products (used during drilling and well completion activities) and long -term production of produced water and oil from the site. To minimize the impact of a surface spill during oil production and storage; there are several specific rules in place under 62C -25 to 62C -30 F.A.C. Rule 62C- 28.004(2) F.A.C. requires the operator to submit a Spill Prevention and Clean Up Plan (SPCP) which is designed to prevent spills of crude oil and associated fluids and to expeditiously remove these fluids from the environment should a spill 0 &G Technical Report Packet Page -683- November, 2014 AECOM Collier County 11 /18/2014 11. D. occur. As part of this plan, equipment necessary to rapidly control spills and to comply with the SPCP shall be maintained and readily available at all times. The SPCP must be kept current and updated as changes occur at the site. Rule 62C- 28.004(3) F.A.C. requires that during production operation all facilities and related equipment shall be designed and maintained to prevent pollution. The use of high -low pressure and level sensors and shut down devices, pressure relief valves, check valves, gas detection systems, are required. In addition, specific bonds and securities required under 62C- 26.002 F.A.C., related to production facilities and tank batteries cannot be released until these facilities are removed and the sites restored. To minimize accidents related to storage of fuel, hazardous chemicals and produced water storage; Rule 62C- 28.004(4) F.A.C. requires all tank batteries to be constructed upon pads certified by a registered professional engineer to ensure it is relatively impermeable to hydrocarbon and saltwater spills. The pads are surrounded by dikes or fire walls of sufficient size and strength to contain twice the volume of the largest storage tank within the diked area. Crude oil storage tanks are required to be equipped with equalizing overflow lines and installed on foundations above the floor of the containment area so that any leaks can be immediately seen around the tanks. The operator of onsite tanks are required to install, maintain, pressure test, and protect against corrosion in accordance with generally accepted petroleum industry standards and practices (62C- 28.004(5) F.A.C. In addition, the operator shall monitor all equipment and facilities to immediately detect any leak, which might cause pollution. All unattended facilities equipped with remote controlled and automatic monitoring systems are required to be inspected at least every third day with all other facilities inspected daily. The operator is responsible to implement immediate corrective action in accordance with their SPCP to rapidly bring any spill under control and to clean up the site without delay. In national and state forests and parks, wetlands, and other sensitive areas, prefabricated tanks and drip pans are required to contain all waste fluids, and on a site specific basis, reserve pits must be lined with impermeable material (62C- 27.001(4)(a) F.A.C.). Since 1972, there have been 393 reported spills (regulations require reporting of spills over 5 barrels or 210 gallons) in Florida - totaling 1,281 barrels of crude oil spilled and 16,636 barrels of brine spilled. The FDEP maintains that this amount is minimal, equating to 0.0002 percent of the oil produced (Newsweek, February 27, 2014). O &G Technical Report Packet Page -684- November, 2014 AECOM Collier County 11 /18/2014 11. D. The sixth question posed was related to the disposal of produced water and drilling and fracking fluids, which are not subject to hazardous waste regulations under RCRA Subpart C but generally regulated as a non - hazardous industrial waste. The majority of produce water (brines) generated during oil production is disposed of via Class II injection wells, which are regulated by the FDEP Oil and Gas Rules under Chapters 62C -29 F.A.C. During disposal of produced water via Class II injection wells; the operator is required to submit to the FDEP the daily injection volume, the anticipated injection pressure and the chemical analysis of a produced water sample, and determine the adequacy of protection of freshwater aquifers. Oil and gas exploration and production wastes, including drill cuttings and drilling muds are not classified as hazardous waste under federal law. Generally, these drill cuttings are shipped off -site for disposal as non - hazardous solid waste. Solid waste and drilling fluids (muds) should be required to be tracked and disposed of at permitted solid waste landfills. For more information, see U.S. EPA's Publication "Exemption of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations," available at www.eoa.aov /osw /nonhaz /industrial /sr)ecial /oil /oil- gas.pdf. Drilling and flow -back fluids are often disposed of at industrial wastewater treatment facilities. Reuse of muds has been increasing over the last few years while disposal at public -owned wastewater treatment facilities (POTWs) has been decreasing, and is now rarely done. Other disposal options include landfills and injection into Class II disposal wells. Construction and operation of Class II wells in Florida require permits from the EPA under 40 CFR §144 to 146 and the FDEP under 62C -29 F.A.C. In southwest Florida, the primary target of Class II injection wells is the highly permeable Boulder Zone, which has been used for fluid disposal at 11 of the 13 oilfields since 1943 (Meyer, 1989) 4.2 Mogan- Collier 20 -314 Well Stimulation The Hogan - Collier 20 -3H was drilled initially as a vertical exploratory well to evaluate the Sunniland Trend. The proposed depth of the pilot hole was 13,500 feet total vertical depth (TVD), which provided information to assess the Upper Sunniland Formation, Lower Sunniland Formation, and Pumpkin Bay Formations (see Figure 2 -2 for reference). Based on the initial evaluation that the well would be commercial, it was completed with the horizontal leg in the Lower Sunniland Rubble Zone with a landing depth at 11,903 feet TVD and a final measured depth (includes both the vertical and horizontal segments of the well) of 16,900 feet. O &G Technical Report Packet Page -685- November, 2014 AECOM Collier County 11 /18/2014 11. D. A documented summary of products used in the stimulation fluid introduced into the well during work - over operations during the latter part of the December 2013 indicate the composition of the fluid and percentage of each component is similar to those used during hydraulic fracturing operations. However, available information related to the actual work -over activities at the Hogan 20 -3H well is insufficient to determine if hydraulic /acid fracturing was used as part of the work -over stimulation activities. Pressure information measured during the work -over activities was requested from both CRA & FDEP and neither provided the information, therefore a technical determination cannot be made related to the occurrence of hydraulic /acid fracturing at this site. Once all relevant information is made available, it should be assessed, and if necessary integrated into an appropriate geomechanical /hydraulic model to quantify the potential for upward migration of fluids from this reservoir through the overlying low permeability units or via the proximal plugged and abandoned wells #86 and #103 to determine the potential impact to the USDW. Potential Risks associated with hydraulic and acid fracturing operations in general include: • Upward migration of fluids used during hydraulic fracturing operations via proximal P/A oil wells. This risk is dependent on the plug and abandonment method, length and type of cement plug, the weight of the heavy drilling fluid used, and the potential deterioration or failure of cement plug. • Potential upward migration fluids along the annulus due to poor cementing or un- cemented section of the production casing. • Excess carbon dioxide generation during well acidization causing increase wellhead pressure and venting of carbon dioxide gas. • Induced seismic activity as a result of over- pressuring the rock formation or causing movement along existing proximal fracture and faults, if present. These seismic events occurring in other parts of the US are generally associated with long -term or high rate injection via Class II injection wells. • Accidental surface spillage of chemicals used during operations, storage or during transport that may cause localized contamination to the shallow ground water or surface water bodies. • Accidental surface spillage of flow back water onsite and during transport to a disposal facility that may cause localized contamination of the shallow ground water or surface water bodies. O &G Technical Report Packet Page -686- November, 2014 AECOM Collier County 11 /18/2014 11. D. Potential actions to quantify /address ground water contamination issues specific to the Collier Hogan Well 20 -3H: • Based on P/A completion records for Well #86 and #103 that indicate plugging deficiencies be required to meet current requirements consistent with 62C- 29.009 F.A.C. especially within the fresh and brackish water aquifers. • Install shallow monitoring wells (15 to 30 feet in depth) to determine the presence of contaminants within the SAS related to drilling and subsequent stimulation activities. • Install a dual -zone monitoring well to provide water quality data to determine (quantify) if the work -over well stimulation activities caused contamination of the lowermost • USDW. 4.3 Water Resource and Aquifer Protection Action Items Recommendations for Construction and Oversight Standards for Inland Oil Drilling and Fracking, Collier County 2015 State Legislative Priorities Construction Standards 1. Review and amend, as necessary, all well and site construction requirements. 2. Amend Rule 62C -29 to require Class II injection wells have consistent permitting, well construction, testing, operational, reporting, and plug and abandonment requirements as those stipulated for Class I Industrial Injection Wells as per Rule 62 -528 Underground Injection Control F.AC., which are more stringent than those required by Rule 62C -29. 3. Amend Rule 62C- 28.004, which requires all tank batteries to be constructed upon sufficiently impermeable pads, to include secondary containment for all fuel, hazardous materials /wastes (including exempted), piping, wastes, and produced water storage tanks to minimize contamination risk to shallow groundwater and surface water bodies. 4. Amend Rule 62C- 27.005(1) to increase the surface casing depth to extend a minimum of 100 feet below the deepest underground source of drinking water (USDW). Currently the rule stipulates that the surface casing be set below deepest UDSW with no specified depth. O &G Technical Report Packet Page -687- November, 2014 AECOM Collier County 11/18/2014 11. D. 5. Amend Rule 62C- 27.005(3) to increase the cement fill of the annular space to whichever is greater, either the static fluid level of the reservoir or 1,500 feet above the uppermost producible hydrocarbon zone being used. 6. Amend Rule 62C- 27.005 (4) to increase minimum surface pressure requirements for the production and tubing and packer to 1.5 times the anticipated static, operational, or planned work - over /well stimulation pressures. Current regulations stipulate a minimum surface test pressure for the production casing and tubing and packer of 1,500 psi and 1,000 psi, respectively. These pressures may not be representative of work -over and production activities for individual oil & gas wells. 7. Establish minimum annular cement thickness for the production casing — similar to minimum requirements for water wells and Class I injection wells completed in Florida or specify API standards or practices. Oversight Standards 8. Add a requirement that the applicant fund an onsite inspector, similar to a construction engineer inspector, employed by FDEP who must witness all of the construction, drilling, fracturing, plugging, and abandonment activities including those activities related to waste disposal. This inspector shall have the authority to stop work. 9. Review all records related to the plug and abandonment of oil wells, especially those in close proximity to existing public water supply wellfields to determine their adequacy to protect water quality. Develop a requirement that if information indicates inadequate protection of the plug and abandonment method used, move forward to reenter and properly plug and abandon the well to isolate all open -hole sections. 10. Identify and develop appropriate regulations to identify and protect the public from the hazards associated with future public water supplies in proximity to wells not plugged /abandoned to current standards. 11. Add a requirement for surficial aquifer monitoring wells around exploration and production wells to be monitored by FDEP. Applicant shall pay the costs of the wells and monitoring. 12. Add a requirement for chemical disclosure statement related to all drilling and well stimulation fluids. O &G Technical Report Packet Page -688- November, 2014 AECOM Collier County 11 /18/2014 11. D. 13. Add a requirement that disposal of all solid debris (well cuttings) and heavy drilling fluids generated during drilling and completion of an oil well be disposed at a secure landfill that is permitted to accept industrial waste. 14. Add a requirement that the FDEP's Oil and Gas Section notifies and copies Collier County on all applications, supporting documents, submittal and meeting notices, correspondences related to future oil and gas exploration, oil and gas production, Class II injection wells, and any oil and gas related waste disposal located within or for wells located within Collier County. 15. Develop a requirement to post an increased or additional bond that is sufficient to the cover the costs of site remediation should site or aquifer contamination occur. 16. Add a requirement that the FDEP conducts a minimum number of annual inspections in addition to the witness requirements addressed in number eight. 17. Amend Rule 62C- 28.005(1) to reduce the reportable spill volume from 210 gallons (5 barrels) to 25 gallons for spills that occur during any oil and gas exploration, production, or completion activities including but not limited to drilling, testing, work- overs. Spills of materials include but are not limited to drilling fluids, produced water, fracking fluids, hazardous and petroleum products, hazardous and petroleum wastes, or materials and wastes exempted from the hazardous waste rules. This amendment would be consistent with existing state regulations for petroleum products not associated with oil and gas exploration /production activities. 18. Add a requirement that backflow prevention devices are installed, working, and tested weekly for all water supplies onsite. O &G Technical Report Packet Page -689- November, 2014 AECOM Collier County References 11 /18/2014 11. D. References: Applegate, A.V. and Pontigo, F.A. (1984) Stratigraphy and Oil Potential of the Lower Cretaceous Sunniland Formation in South Florida; Florida Bureau of Geology Report of Investigation No.89 Arthur, J. D., Bohm, B., Layne, M., (2008) Hydraulic Fracturing Consideration for Natural Gas Wells of the Marcellus Shale, ALL Consulting The Ground Water Protection Council 2008 Annual Forum Cincinnati, Ohio September 21 -24, 2008 Bellarby, J., (2009) Well Completion Design; Development in Petroleum Science No.56; 711 pp Boyer, C., Kieshchnick, J. and Lewis, R (2006) Producing Gas from Its Source; In Oilfield Review Fall 2006 pp 36 -49 Bourgoyne, A. T., Millheim, K.K., Chenevert, M.E., and Young F.S. (1991) Applied Drilling Engineering, Society of Petroleum Engineers Textbook Series Vol.2 Curtis, R. 2011. What is horizontal drilling, and how does it differ from vertical drilling? Institute for Energy and Environmental Research of Northeastern Pennsylvania Clearinghouse website; http:energy.wilkes.edu /158.asp. Posted 14 January 2011 Flaherty, K.J., and Flaherty, J, III (2014) Oil and Gas in Pennsylvania (3rd edition), Pennsylvania Geological Survey 4th Series, Educational Series 8; 36p Florida Department of Environmental Protection Oil & Gas 101 available at http: / /www.dep.state.fl.us /water /mines /oil_gas /index.htm Institute for Energy Research, "Hydraulic Fracturing —Is It Safe ?" May 3, 2011, http:// www .instituteforenergyresearch.org /2011 /05/03/ hydraulic - fracturing -is -it -safe. Kalfayan, L., (2008) Production enhancement with acid stimulation 2nd edition PennWell Corporation 252 pp. King, G.E., (2012) Hydraulic Fracturing 101: What Every Representative, Environmentalist, Regulator, Reporter, Investor, University Researcher, Neighbor and Engineer Should Know About Estimating Frac Risk and Improving Frac Performance in Unconventional Gas and Oil Wells. SPE 152596, Michie & Associates (1989) Evaluation of Injection Well Risk Management Potential in the Williston Basin; Prepared for Underground Injection Practices Council Research Foundation. 79 pp. O &G Technical Report Packet Page -690- November, 2014 AECOM Collier County References 11/18/2014 11. D. Miller, J.A. (1986) Hydrogeologic Framework of the Floridan Aquifer System in Florida and in Parts of Georgia, Alabama, and South Carolina Professional Paper 1403 -B, United States Geological Survey. Ohio Department of Natural Resources, "Wastewater (Flowback) from Hydraulic Fracturing," http: / /ohiodnr.com /Portals /11 /pdf /wastewater- fact - sheet.pdf Pollastro, R.M. (1995) USGS National Oil and Gas Play -Based Assessment of the South Florida Basin, Florida Peninsula Province U.S. Geological Survey Digital Data Series 69 -A Price Waterhouse Cooper (2013) Economic Impacts of the Oil and Natural Gas Industry on the U.S. Economy in 2011 funded by the American Petroleum Institute; 86pp Reese, R.S, (1998) Hydrogeology and Distribution of Salinity in the Floridan Aquifer System, Southwestern Florida; USGS Water Resource Investigation Report 98 -4253. 86 pp. Scott, T.M. 1988. The Lithostratigraphy of the Hawthorn Group (Miocene) of Florida, Bulletin No. 59, Florida Geological Survey. U.S. EPA's Publication "Exemption of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations," available at www.epa.gov /osw /nonhaz/ industrial /special /oil /oil - gas.pdf Veatch, R. W. Jr.., Moschovidis Z.A and Fast, R.C., (2004) An Overview of Hydraulic Fracturing. in Recent Advances in Hydraulic Fracturing, Edited by John L Gidley, Stephen A. Holditch, Dale E. Nierode, and Ralph W, Veatch Jr. Society of Petroleum Engineers, Henry L Doherty Series Monograph Volume 12 0 &G Technical Report Packet Page -691- November, 2014 11/18/2014 11.D. pp k f' ,. .y tv s i N, A d w ✓.4SJ4' ",��s'#+q C i�fl xt"+la $.n.,Y l#^4 � }�, :.� Packet Page 693 �.1 11 /18/2014 11. D. A A Packet Page -694- m 11.D. 0 00 (D -0 E a) 0 RVA Hi ■ Amp Anj Packet Page -696- 11 /18/2014 11. D. 1 ,y Ma a� MO Cn E 0 • 11/18/2014 11.D. L- 0 Z N E >1 2 a) E x CD C) > E r. O O 4-j 4-1 m C) C) Co O M 0 CL CY) CU m w v c v ?' 7s 5 L6 19 32 E .2 C. L- 0 Z N E >1 a) E x CD C) > 0 C/) O O 4-j 4-1 m C) C) Co O L- 0 N E >1 a) E x Packet Page -697- LWJ (D O O O O Cn m C: 0 0 L- CL A rid 0 O TT 4-1 M 0 CL CY) CU m Packet Page -697- LWJ (D O O O O Cn m C: 0 0 L- CL A rid 0 a 0 0 Lm om ■ 1�1 11 /18/2014 11. D. 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Packet Page -718- u a Experience Of Staff 11/18/2014 11.D. N/liehael W. Bennett, PG Education Mr. Bennett is a licensed professional geologist with over 25 years of experience in [ IS, HG Jr Geology hydrogeology, ground water modeling, geochemistry, and geophysics. He provides technical consultation on the design, permitting, groundwater hydrology, aquifer storage Special Training: and recovery and deep water injection projects. He offers expertise in hydrogeologic Professional Geologist, FL and geochemical characterization of ground water systems, groundwater flow modeling, No. PG i 558 borehole and surface geophysics investigations and the permitting and design of Class I, Professional Geologist, Tx Injection and ASR well systems. He also brings his expertise with project and No. PG307 construction management of multi - million dollar Water Injection -ASR Well projects. Professional Geologist. _A Mr. Bennett is a Principal Hydrogeologist for the firm. No.29 Senior Aquifer Injection Specialist- Arrow Energy - Brisbane Australia Professional Memberships Responsibilities included the site selection evaluation, subsurface appraisal, permitting Florida Association of and the design of deep injection well systems in accordance with US Class I standards Professional Geologist for the disposal of treated produced water from Coal Seam Gas operation at two sites in National Ground water the Surat Basin of Queensland Australia. This phase of work entail the development of Association water aquifer storage and recovery management plan to conduct phase I trials to support American Waterworks government approval to develop large -scale water injection well systems. These Association injection well systems were designed to match the water production curves during the American Institute of anticipated 20 year development life of the coal seam gas fields. Professional Geoiogists Senior Technical :advisor - Queensland Gas Company 11ty I,td (a BG Company) - Brisbauie Australia Publications P41 . J. B nnett, M and Responsibilities included the development of an option analysis related to pre - treatment Lopez. J. (2013). Arsenic Kring options necessary to treat produced Coal Seam Gas water prior to subsurface injection Control Aquifer and storage into the Precipice Sandstone at their Woleebee Creek site. Storage Recovery Cycle Tests in the Floridan The stud include surface infrastructure needs to achieve desired water quality limits y q �' Aauiter— Ground Vb'ater prior to injection as per QGC standards and regulatory requirements. The surface Bennett M. and d:s infrastructure scope definition project involved scoping the conveyance piping, high in lore J, 2606. Dating of Florida's Groundviater: mapping the pressure pump system, water treatment (mechanical filtration, de- oxygenation and chronology of the fliv, from disinfection), power requirements (temporary and line) and storage requirements for a revharge to ocean discharge production trial, injection trial and full -scale injection scheme with a planned capacity of ;presentation), American I OOMLD and injection pressures up to 3,000psi. In addition, geochemical modeling was Ground I s ,' aI Tri t., 200 provided to determine the potential impact of mixing Reverse Osmosis treated water with Pec o er nn Jran-1 (ASR VI) the native formation water. The Concept Design of the Injection trial was submitted to r ce Octn be r 1 > -16, the Client which fonned the Engineering Basis of Design for the ASR well system. 2'f}iE`Ct '9' a¢Elzi;;%'r, T €i «2. €7' ii'... ?'t [" >_�'ef'lk Ik._1£Le €:;I ii 6'sl ;i< l In l'.`'tion. 1i ell per miu,ing. Desi -l" and, `i on"Ira e, iim ON € "d. ht. x? s`."ic, I'lsri iEaa Responsibilities included the design and permitting of a Class I deep injection well system for the disposal of secondary treated effluent and reverse osmosis concentrate fi'om the Town Water /Wastewater Facility. The Class I System is the largest capacity Class I system in the State of Florida with a build -out disposal capacity of 25.8 MGD. The UIC construction application was submitted and approved by the State /Federal regulatory agency for alternate design including a cement annulus of the injection tubing and use of non - seamless carbon steel injection casing. A qualified well drilling contractor was selected to begin construction and testing of this Class I Industrial Disposal well which began in January 2011. This Class I injection well system was designed as alternate design type injection well which will have a 20 -inch diameter fully cement injection tubing composed of Oilfield Fiberglass Reinforce pipe reducing the need for additional annular pressure system an monitoring and reporting requirements. AECOM successfully completed 1 1 P g r' Packet Page -719- Experience of Buff 11/18/2014 11. D. the drilling, testing and construction of this Class I system on time and 13% under budget. This Class I injection well system is currently under operational testing. Project Manager, FKAA Class I Peep Injection Wells (DIW) Permitting Design and Construction Oversight, Florida Cite, Florida Responsibilities included completing and submitting an application for variance to locate a DIW system within 500 feet of an active well field. Completed the technical specifications, contract documents and well construction plans to accommodate a change in location of the DIW system. Mike successfully negotiated the specific and general conditions of the Florida Department of Environmental Protection construction permit for the DIW system. Successfully bid the well construction phase and negotiated contract with qualified contractor to construct the DIW system. Oversaw the construction of the deep injection well systems; provided operation testing consultation and documented the findings in a Comprehensive Engineering/Well Construction and Testing Report. Mike completed the O &M manual for the DIW system and provided training to FKAA staff to operate and monitor the system. He successfully obtained an operational testing permit and is currently in the process of acquiring a long -term (5 -year) operation permit for this Class I System. Mike completed this $6.2 Million dollar project on time and under budget. Project Manager - Lake Okeechobee ASR Well System – ITS Army Corps of Engineer —Jacksonville District Responsibilities include the design, permitting and construction oversight of a 5 MGD capacity ASR well and tri -zone monitor well. This ASR system was designed to accept 5 MGD of treated surface water for the Kissimmee River during access flows, and store it until river level fell below a predefined level. Multi- parameter water quality probes were installed into the ASR horizon to proximal and distal monitor wells to monitor changes in native ground water conditions and potential release of arsenic and other trace metals during ASR operations. This data was retrieved, compiled and reviewed and compared to water quality data taken from surface samples during long-term injection and storage periods. The results of the water quality changes during ASR operations were published in the Ground Water Journal. Senior Technical ASR Specialist Environment Ageucy – Abu Dhabi Emirate – United Arab Emirates Responsibilities included conducted an investigation of potential means of providing strategic storage of water to maintain water supply in case of a major system disruption. A main item was the potential use of aquifer storage and recovery (ASR) to provide a 90 day reserve of water to the Eastern Region of the Abu Dhabi Emirate and the Northern Emirates for a time horizon of 2030 In an effort to assess the feasibility of subsurface storage of the 90 -day reserve using the Quatemary/Surficial Aquifer System all existing geologic and hydrogeologic reports were review and data compiled. This included a detailed review of a feasibility study and pilot testing conducted at the Al Shwaib site in Eastern Abu Dhabi. These data were used to investigate ASR opportunities in the Eastern Region and Northern Emirates. ASR site analysis was developed based on a multi - criteria analysis. The compiled and computed data was used to generate GIS coverages that show reservoir characteristics (permeability, porosity, thickness) of the underlying geologic formations. Based on detailed screening criteria, a GIS script file was developed to help identify optimal locations for proposed ASR systems. These GIS point coverage were integrated into existing GIS coverage of topography, primary and secondary roads, power lines, existing pipelines and pump stations, cultural features and political boundaries. A set of screening criteria were developed and a GIS script file written to determine optimal ASR locations based on these surface and subsurface considerations. A composite map was developed to identify areas with different potential for ASR implementation, which indicated the total area with high development potential was available to meet the 90 -day of volume. The study concluded that ASR would be a suitable technology to provide the desired strategic storage however, periodic emptying and refilling would be needed to maintain water quality. Lake `Ikeech €abc-e �quifc r and R coo "r N ` *SR Pro; "Cf, South Florida ida Water er ,r... =,w:m:Ynt District Technical Lead – Well Construction Manager of this $3.2 million Aquifer Storage and Recovery (ASR) Class V well facility. Responsibilities included design of the ASR and associated monitor wells, preparation of permit applications, development of well construction and testing specifications, management of field personnel, communications with the Florida Department of Environmental Protection Technical Advisory Committee, and management of the budget for the project. This project included construction of three deep Floridan aquifer test/monitor wells and two large diameter exploratory ASR wells at three separate locations along the periphery of Lake Okeechobee. Packet Page -720- Experience of Staff 11/18/2014 11.D. Technical Lead /Well Construction Manager, Regional Aquifer Storage and Recovery (ASR) Study, F'11 Mr. Bennett was responsible for a testing plan to collect additional hydrogeologic information to better understand the effects of large -scale ASR implementation within the Floridan aquifer. His responsibilities included design and development of well construction and testing specifications of the multi -zone Floridan aquifer test /monitor wells, preparation of permit applications, management of field personnel, and management of the budget for the project. He developed and implemented testing plans using advanced geochemical techniques (stable isotope, radiocarbon, and noble gases) to gain a comprehensive and regional understanding of the origin and groundwater circulation pattern within the Floridan aquifer system. He also developed and initiated testing plans using specialty geophysical logging techniques (Stoneley wave and Nuclear Magnetic Resonance) to determine the porosity and permeability distribution within a carbonate aquifer. Developed work plans to employ surface geophysical methods to determine lateral continuity of productive and non - productive units as they related to the successful implementation of Aquifer Storage and Recovery technology. In addition, Mike developed and managed a regional Floridan aquifer ground water level and water quality monitoring program. Technical Lead /Construction Manager, Hillsboro Aquifer Storage and Recovery ASR Project, South 11, Responsibilities included design of the Class V ASR and associated monitor wells, preparation of permit applications, development of well construction and testing specifications, management of field personnel, communications with the Florida Department of Environmental Protection Technical Advisory Committee, and management of the budget for the project. During the course of this $1.5 million facility, Mike initiated various research oriented surface and subsurface geophysical programs to determine the porosity and permeability distribution within the ASR storage zone and confining unit via cross -well and tomography and surface seismic reflection/refraction surveys. Project Manager. La Palonin Class I Injection Well :Mechanical Integrity Testing Services, McKittrick, California Responsibilities included the design and oversight to Mechanical Integrity Testing of La Paloma Generating Company's Class I deep injection well system which is used to disposal of blown cooling water. Currently, reviewing the monthly operating reports and previous pressure fall -off testing results to determine optimal injection conditions. Provided the Client with a detailed a set of technical specifications to conduct a Pressure Fall -off Test and Mechanical Integrity Test (MIT) on one — 0.8 MGD Class I injection well. Mike oversees testing operations and submits written report to EPA Region 9 on the results of the MIT. Due to declining injection performance of the current Class I injection well, AECOM is looking at cost- benefit analysis between work -over of the existing injection well or the design and construction of an additional Class I injection well which is allowed under the existing construction permit. Pr o;ect tlarz af-er. RIf AI, 100 INILD M 'ater Treannent Ph nit. M lnifa, Philippines Mr. Bennett investigated the feasibility of injection of waste brine solutions into deep saline aquifers is an alternative disposal method of brine disposal in lieu of surface discharge to Laguna de Bay. Based on an extensive review of the geology and hydrogeology of the Manila area no favorable injection horizons were identified that would effectively isolated the brine from freshwater aquifers due to the lack of an overlying confining layer, so the current or future use of potential the fi-eshwater aquifers will not be impacted by upward migration of injected fluids. Mike provided a written review and recommendation that subsurface disposal option was not a feasible method for brine disposal in this area Project .714ar. oer. Class I Iniection 5 -v'ell, Sictem Martin Courrty'Froraical Fauns. Stwirt, FI, Mr. Bennett finalized the completion of this Class I injection wells and completed the Engineering /Well Construction Report documenting the results of well construction and testing activities related to the 16 MGD Deep Injection Well System. Mike submitted it to the FDEP in compliance with the Underground Injection and Control (UIC) Pen-nit. His responsibilities continue to include compiling and analyzing data from the deep injection well system to prepare and submit quarterly operating summary reports to the FDEP. He provided training to operations staff on the deep injection well system (surge tank) and modified the testing procedures to conduct monthly injectivity tests. He provided assistance in the start-up of the DIW system by installing and modifying equipment on monitor well system. Currently, Mike reviews the monthly operating reports for accuracy prior to being submitted to the FDEP. Mike developed a set of technical specifications to conduct Mechanical Integrity Testing on 2 — 8 MGD injection wells and negotiated testing costs with Contractor all of which were completed on time and budget. I'rtgje ct �I.?.c „er. C'4,ss V Injection yp ell loo. 2, K -e, <Vest. Fl.; Compiled and analyzed the operating testing data from this deep injection system associated with Injection Well No.2. Mr. Bennett prepared and submitted the operating permit application and supporting information to the FDEP. Provided detailed technical responses to request for information from FDEP related to the permit application. Mike successfully 31 Packet Page -721- Experie1 Eco of Staff 11/18/2014 11. D. obtained the long -term operation permit by coordinating efforts between the FDEP, City of Key West Utility Department and the Engineer of Record. Project Manarier, North County Class I Injection Well Facility, .lensen Beach, FL Responsibilities include writing a set of performance technical specifications to plug and abandon IW #1 in accordance with 62 -528 FAC and FDEP- issued pernlit. Met with FDEP staff to determine the necessity to remove the 8 -inch internal tubing and packer within IW #1 and successfully had this requirement removed from the permit reducing the plug and abandonment cost by 50 %. Conducted training on injectivity testing related to IW -2 and rewrote testing procedures in an update to the O &M manual. Mr. Bennett successfully led the permitting effort in acquiring the long- term operating permit for IW #2 and successfully oversaw the permitting and plugged and abandoned operation of IW -1 including submission of the final report to FDEP. Overall project costs for the plug and abandonment of IW -lwere 30% lower than the submitted bid price as the result of working in concert with the Utility, FDEP and the Contractor. Publications Bennett, M.W., 1992. A ground water investigation of the Petersburg Granite in Chesterfield County, Virginia. Unpublished Masters of Science Thesis; Old Dominion University - Norfolk, Virginia. 158 p Bennett, M.W., 1992. A three - dimensional finite difference ground water flow model of western Collier County, Florida: South Florida Water Management District Technical Publication 92 -04, 80 p. Kaufmann, R.S. and M.W. Bennett, 1997. The history of saltwater intrusion and flow in the Floridan aquifer in the western Everglades, southern Florida. Proceedings of the AWRA symposium Conjunctive Uses of Water Resources: Aquifer Storage and Recovery, 407 -416. Kaufmann, R.S., Bennett, M.W., and Pitt, W. J., 1999. Potential aquifer storage and recovery in South Florida. Technical Program and Proceedings of the 74th Annual Florida Water Resources Conference: Tallahassee Florida, 507- 514. Bennett, M.W., 2001. Hydrogeologic investigation of the Floridan aquifer system at the L -2 Canal site Hendry County, Florida: South Florida Water Management District Technical Publication WS -3, 36 p. Bennett, M.W., 2001. Hydrogeologic investigation of the Floridan aquifer system - I -75 Canal site Collier County, Florida: South Florida Water Management District Technical Publication WS -5, 46 p. Bennett, M.W., Linton, P.F., and Rectenwald, E.E., 2000. Hydrogeologic investigation of the Floridan aquifer system, Western Hillsboro Basin; ASR Site 1, Palm Beach County. Florida: South Florida Water Management District Technical Publication WS -8, 33 p. Parra, J. O., Hackert, C. L., Collier, H. A., and Bennett. M., 2001. "A methodology to integrate magnetic resonance and acoustic measurements for reservoir characterization. Second Annual Report. Parra, J.O., Hackert, C.L., Collier, H.A., Bennett, M., 2001, NMR and Acoustic Signatures in Vuggy Carbonate Aquifers. Transactions of the Society of Petroleum and Well Log Analysts (SPWLA) 42nd Annual Logging Symposium, Houston, Texas. Bennett, M.W., 2002. Hydrogeologic investigation of the Floridan aquifer system — Immokalee Water & Sewer District Wastewater Treatment Plant, Collier County, Florida: South Florida Water Management District Technical Publication WS -14, 42 p. Bennett, M.W., 2003. Hydrogeologic investigation of the Floridan aquifer system — Labelle, Hendry County, Florida: South Florida Water Management District Technical Publication WS -15, 52 p. Parra, J.O., Bennett, M., and Collier, H.A., 2003. High- resolution acoustic and seismic investigation of carbonate rock properties. Transactions of the Society of Petroleum and Well Log Analysts (SPWLA) International Symposium, Galveston, Texas. 41 " ', e Packet Page -722- Experience Of Staff 11/18/2014 11. D. Bennett, M.W., 2003. Hydrogeologic investigation of the Floridan aquifer system — Big Cypress Preserve, Collier County, Florida: South Florida Water Management District Technical Publication WS -18, 57 p Parra, J.O., Bennett, M., and Collier, H.A., 2003, Permeability and porosity images based on NMR, sonic and seismic reflectivity: Application to a carbonate aquifer; The Leading Edge, 22(11), pp. 1102 — 1108. Kaufmann, R.S., and Bennett, M.W., 2004, Carbon -14 dating of groundwater from the Floridan aquifer in South Florida: Miami Geological Survey, South Miami, 20 p. 6 figures, 2 tables Clark, J.C., Bennett M.W., Murrel, Michael T., Stute, Martin, and Rademacher, Laura K., 2004. Time scale of seawater circulation and dolomitization within the lower Floridan aquifer, Paper No. 136 -8 GSA Abstracts with Programs Vol. 36 No. 5, 2004 Denver Annual Meeting (November 7 -10, 2004) Will, W., and Bennett M.W. 2004. 3 -D Visualization for Hydrodynamic and Geomechanical Analysis of an Aquifer Storage and Recovery (ASR) System in South Florida. NGWA Abstracts with Programs Vol. 36 No. 5, Las Vegas, Nevada Bennett, M.W., 2004. Engineering — Well Completion Report - Floridan aquifer system ASR Test Monitor Well ORF- 60; Reedy Creek Improvement District, Orange County, Florida: South Florida Water Management District Technical Publication WS -20, 30 p. Pettey, P.A., and Bennett, M.W., 2006. Reducing the high cost of an ASR test well, Florida Water Resources Journal, Water Supply Issue, February 2006 pp. 20 -26. Parra, J.O, Hackett, C.L., Bennett, M.W., 2006. Permeability and porosity images based on P -wave surface seismic data: Application to a south Florida aquifer, Water Resource Research, v.42 pp. 2415 -2439. Bennett, M. W., and Mirecki, J, 2006. Dating of Florida's Groundwater: mapping the chronology of the flow from recharge to ocean discharge (presentation), American Ground Water Trust; 2006 Florida Aquifer Storage and Recover program (ASR VI) Conference, October 15 -16, Orlando. Florida. Bennett, Michael, Richardson, Emily, and Clark, Jordan, 2007. Timing and Ground Water Circulation within the Floridan Aquifer System of South Florida; Southeastern Section -56th Annual Meeting (29 -30 March 2007) Paper No. 3 -8. Clark, Jordan, Morrissey, Sheila K., Bennett, Michael, Richardson Emily and Stute, Martin, 2009, Reorganization of Groundwater Flow during Sea Level Rise; Portland GSA Annual Meeting (18 -21 October 2009) Paper No. 272 -9 Sheila K. Morrissey, Jordan F. Clark, Michael W. Bennett, Emily Richardson and Martin Stute, 2010, Groundwater reorganization in the Floridan aquifer following Holocene sea -level rise, NATURE GEOSCIENCE Letters, DOI: 10.1038 PUBLISHED ONLINE: 12 SEPTEMBER 2010. Mirecki. J.E., Bennett, M.W. and Lopez - Balaez, M., 2013, Arsenic Control during Aquifer Storage Recovery Cycle Tests in the Floridan Aquifer, Groundwater Journal 5 1 '' Packet Page -723- 11 /18/2014 11. D. MEMORANDUM Date: October 24, 2014 To: Dinny Neet, Paralegal/ Legal Assistant County Attorney's Office From: Martha Vergara, Deputy Clerk Minutes & Records Department Re: A Stipulation before the State of Florida Department of Environmental Protection, Collier County and Collier County Water- Se -wer District V. Florida Department of Environmental Protection, and Dan A. Hughes Company, L.P. In the Division of Water Resource Management OGC File No.: 14 -0012 Attached for your records is a copy of the Certified Stipulation referenced above, (Item #12B) adopted by the Board of County Commissioners on Tuesdav, Octooer 14, 2014. The original Resolution will be held in the Minutes and Records Department for the Board's Official Record.. If you have any questions, please call me at 252 -7240. Thank you. Attachment Packet Page -724- 11 /18/2014 11. D. -. )T7i BEFORE THE STATE OF FLORIDA DEPARTMENT OF LAVIRONAMU*,NTAL PROTECTION C� >LLIf it COUNTY and COLLIER CMA'I YVAT1]R-SEWL-.R DISIRICT. PetWorturs. Fl (IRMA DEPA!ZTN1F-',,T 01: [NVIRONNH--'` IAL PROTi-V] R)N, and DAN -\. HUGHLS LK Rcspondcnts. STIN LATION INTI IE DIVISION Of-- \VATER l%'1-,S0I:RCi:*, M A NIAGLM 1-*,"�T 0GC l'i le No.: 14 -0012 11/18/2014 11.D. 1 hk SAMAMwn K Why cmand by and Riween Wher Couniv and the RAW Cwz� ',. TWer-Sewar DAM thu 11titionw& and Ow Florida Apait-ncn! of Winmninval Maw I vim ;1 as ofdlis --'014. In wonqidewion M Pshionns "ithdrawV diQ Puthion Wine 12. 2014) rind %niended Petiti,-'R OU!y 1. 2014L le AM Departmcm ANSnmentai Protection thcrciriafler re' :rred to as "T'll-A J"') hcroby a :rces Lis follows: 1. The cwmirments so Ash in Scarwan, Vhn-arci's Idler dinied to Aw (Wher C (on, Bond dCount% CWWnWicr5. a ()py ol'�\ hich i� atla�:hed as L'Ahibit A. 0'0 inwiporalva KV rvn&2n into th" Upwimion 3, if UA "I AM IMF 0%. 2, %C of the Commitments in swan \ k,-ttr i= jTjhc A pwwwo "All Ook WN NOW! it, MAN aLahMily a, furthar swanglon, or ex6thig vil pr,grarn regWALM ThS \v ill i!tcludc updating the current statutes vi address new Whnologies and include greater MWOU'V4. 10 Deporn-nan zommim a, "at adlahwivniv "Ah till' County to Adruis A� "i-"o 1SRUIV: pwos MAU, ' !Mxd� T: c!Q. FDK3 conflnus 1W 10 Carmi'mtnt tcc'-ir,l� '-' illCIudimt�' the acti\itic�. trtc'i11 }t7i;�! *§ nd 'appaq at the U Q.-Wjjp x\:P Aw. !rZ '20�'-: "o i"' d"�-: 7 Mhospoo QQAwkward Rayu moo, Wk w7. ISM, it brill ai:'Liltl> C.: !, "Li". tn"S and "A., with all ol'tllc Packet Page -726- 11 /18/2014 11. D. in Collier County with respect to proposed lei,islative and regulator-v changes. including but not limited to Collier County. the Collier CountNI Water -Sewer District, The Conservancy-. Collier Resources Company. as well as any other affected land oNkner.s. 4. Petitioners will file a 'Notice of Dismissal of their Petition within 5 business days of the full execution of this stipulation. IN 'WITNESS WHEREOF. the undersigned have executed this stipulation as of the date first -set forth above. COLLIER COUNTY: VFTES T:- D\V 101-11: E BROM.Clerk -N, B A- siviture only, S'1, A I'll OF FLORIDA DEPARTl'%1EXT ()1 ENVIRONMEN'LAL 1PRO]IFICTiON Herschel 1'. Vinvard Jr. Secretary . Al rpro cd as To fbrm t d iegality: a z K- c, W, BOARD OF COUNTY COMN41SSIONERS ('01- LIER COUNTY. FLORIDA TOM FIENNTEV3. CHAIRMAN 14 20. , -1 L - ?Jim =NDA I77M 12-B Packet Page -727- 11/18/2O14 11.D. E��BIT A FLORIDA zoollum a&& � DEPARTMENT OF ENVIRONMENTAL PROTECTION m^:uDKvsTnxFMm* DOUGLAS BUILDING 39nnroMMOwv/EA(JnBOULEVARD TALLAHASSEE FLORIDA JZsvY'][wn September 12, 20 14 Collier Coun*' Board ofCommissioners �299Taniomi Trail East Suitc30] Naples. F|oridu34l\2 Dear Collier Cmun\yCommissioners: It was u pleasure 0o b.-with you ut this pvetk`a Collier Cmuntv Commission meeting. l um grateful for the opportunity the Commission afforded me to discuss aUdheactions that the Florida Dc-�urtmcn|ot'Environmonta yroiec ion ( is taking to protect the families and inorcdib|coaturo| resources of Collier County. The issues that nediscussed rogardingoil produc/imn and the protection ofthc grnuod�,vatcr resources are oythe utmost importance. and ) appreciate the clear message that the Commission sent in its desire no work col|abonaivc|v with the Department. l want nothing more than to work in utrunspmznt and open manner with }mu- our local partners - for the benefit o{the cidzccs and the environment. Asireizvedmthe Commission, the Departmenr has been hard at work over the summer. taking action to hold Dan A. Hughes legally accountable., but we will not wait for the nutcomcw[tha1|kiaui\onno seek out and eUminut-- any threats tm groundwater resources. That is why the Department has already begun groundwater testing and investigation, stauingwiih the drilling uf six shallow monitoring wells. The Department will also undcrtzkc numerous additional protective measures at our own expense in the cominz monzhs, /\s requested by the Commission, l would |[kczo for rua|>y commit in wrizinz to theudditionu| action items the Department will be taking to address the County's concorns. vertain�nr- both loihc Cu|\icr-Bavan "/c}l mnd }tgio}uriveaod r:gu|zlory prupos all x. Actions to Address the Coilier-Hogan Well Loo� ibis mon1h,bic Deparzmcnt will iosud| o l.850 foot groundm'atcrcomokorhzu��U Vn zsc*fr.he°undercrouod source of dr;nkjncv,aLer.` The lo= i000fthc ' -,veB *i|\bcdonnzrudi��o{�ho (�oUi��-Bo�an well 10 bc certain any contamination is dct,,c��, Waurqudit!tes ing in rbis d--o- vc | xi|| be comp\et*d, and sarnn\i ioh results,�vjll be relcased toth,: Countv an,,' the public as soon as results are availabl-e. Packet Page -728- ---------- _ 11 /18/2014 11. D. Collier County Commissioners Page 2 September 12, 2014 Additionally, the Department will perform analysis of the flowback material produced at the Collier -Hogan well, immediately upon obtaining adequate samples of the material. The Department will use all legal means to obtain samples of the flowback material and analysis of the materials from any available sources. The Department will also investigate and address how Dan A. Hughes treated and disposed of the flowback material. The Department is hiring a team of independent third -party experts — with no ties to the Dan A. Hughes Company or Collier Resources Company — to assess the activities that took place at the Collier -Hogan well and determine whether those activities present any concern to the groundwater resources in Collier County. We will provide the County the opportunity to consult with the Department on the selection of the third -party experts and will ensure that the County's experts have the ability to collaborate with our experts in this endeavor. As part of the work of the third -party experts, the Department will require an analysis of the two plugged wells nearby the Collier -Hogan well (Gulf Coast Realty Corporation C I Well, Permit Number 86 and Gulf Coast Realty Corporation E 1 Well, Permit Number 103). The analysis will include an assessment of whether the two wells could have been affected by the Collier -Hogan well, whether they present any concern of contamination to the underground source of drinking water and whether re- entering those old wells is recommended. If, at any time, contamination of eroundwater is discovered related to the Cofer -How well, the Department will seek full assessment and remediation of the contamination. as required by its legal authorities to Rrotect public or private water sources Legislative and Regulatory Actions The Department will seek additional legislative authority to further strengthen our existing oil program regulations. This will include updating the current statutes to address new technologies and include greater protections. The Department commits to work collaboratively with the County to address its concerns as the legislative process moves forward. As part of this process, we will seek to increase the maximum penalty amounts available, to ensure that energy companies like Dan A. Hughes Company will be deterred from engaging in an unauthorized activity. We will seek greater authority from the Legislature to consider operators' prior history of violations in other states as part of the Department's permitting decisions. We will seek additional authority to require the latest technology to conduct real -time well monitoring on a continuous basis for all active wells in Florida. We will also seek to increase the current bond requirements for oil well operators to make certain that, in the event of a spill, there is more than adequate funding to perform complete cleanup and rernediation activities. ', 1; c/i ' 0(, /� re, Packet Page -729- 11 /18/2014 11. D. Collier County Commissioners Page 3 + September 12, 2014 Again, thank you for your support of the Department's efforts to protect our citizens. I want to reiterate what I said at the Commission meeting - the Department will openly support the County should it chose to join us in the litigation that is currently pending against Dan A. Hughes; both our enforcement action in Collier County Circuit Court and the permit revocation action in Tallahassee. I have extended the same offer to the Conservancy of Southwest Florida, should it choose to participate in those actions. 1 have a deep appreciation for the critical role local government plays in protecting the health, safety and welfare of Florida's residents and the environment. I know by standing together we will guarantee a safe, clean and abundant drinking water supply for Collier County's families. Sincerely, W,Jff' K-7-1j- Herschel T. Vinyard Jr. Secretary Packet Page -730- 11/18/2014 11. D. Collier County 2015 State Legislative Priorities Issues ofMaior Importance to Advocate: 1. Inland Oil Drilling & Fracking — The Board of County Commissioners (BCC) has requested assistance from the Collier County Legislative Delegation to support legislation that improves and strengthens State rules and regulations governing oil well drilling activities. The BCC has entered into a formal agreement with the Florida Department of Environmental Protection (DEP) to jointly develop and support regulatory reforms in this industry. 2. Pedestrian and Bike Safety — Collier County will ask the Florida Department of Transportation (FDOT) District One Secretary Billy Hattaway how Collier County can assist in his 2015 Pedestrian and Bicycle Focused Initiative in a complementary fashion. Collier County will also participate in a statewide task force to address these safety issues and education effectively. 3. University of Florida /Institute of Food and Agricultural Sciences (UF /IFAS) Collier County will continue efforts to identify and pursue a recurring funding source for OF /IFAS. 4. Human Trafficking— Work with the Collier County Sheriffs Office to add measures to the 2012 Florida Human Trafficking Law that improve and strengthen current legislation. 11 ater Ouality Funding Requests: Collier County is requesting funding allocations from 2015 Florida Legislature appropriations for five (5) water resource projects identified as critical needs in the community. The following prioritized water projects have been identified based on deliberate, measured review: 1) Naples Park Water, Wastewater and Stormwater (Swale Rehabilitation and Culvert Replacement Program) Project Description: This is a phased project which will replace all three types of water infrastructure components resulting in water quality improvements reducing pollutant loading to the impaired waters of Wiggins Pass. 10.28.14 Packet Page -731- 11 /18/2014 11. D. Attachment 5 2 Cost: The estimated total cost for construction is $10 million, including $1.4 million for stormwater and $8.6 million for water infrastructure components. II) Golden Gate City Outfall System Replacement Program (Golden Gate City Stormwater Improvement Project) Project Description: The project will improve collection, treatment and conveyance of stonnwater runoff within the four(4)- square -mile area of Golden Gate City. Stormwater runoff from this 50- year -old system is conveyed to the Golden Gate Canal system, which discharges into the impaired waters of Naples Bay. Cost: The estimated cost for Phase I construction is $0.8 - $1.6 million. III) Livingston Road Aquifer Storage and Recovery (ASR) System Project Description: This is a shovel -ready program for wet and dry season optimization of water resources through ASR that will enhance the environment and provide a sustainable water supply. Cost: The estimated cost bundled in a single phase is $15 million for Fiscal Year (FY) 2015/16. Alternatively, three (3) phases would request $S million each for FY 2015/16, FY 2016/17, and FY 2017/18. IV) South Service Area Re -use Optimization Project Description: This is a permitted project for wet and dry season optimization of water resources through four (4) new Lower Tamiami wells to supplement Irrigation Quality (IQ) water supply in the South Service Area to enhance the environment and provide sustainable water supply. Cost: The estimated cost for Phase I, including two (2) wells at $2 million each, is a total of $4 million for FY 2015/16. Phase II will include two (2) wells at $2 million each, $4 million total in FY 2016/17. V) Lely Area Stormwater Improvement Project (LASIP) /Wingsouth Airpark Channel Improvements Project Description: This project will improve stonnwater collection, conveyance and quality while rehydrating environmental preserve areas in the upstream section of the Rookery Bay watershed. The improvements are a component of the Lely Area Stonnwater Improvement Project (LASIP), a regional stonnwater improvement master plan. Cost: The estimated cost for construction is $2.6 million. Issues to Monitor: The Board of County Commissioners (BCC) on behalf of Collier County citizens advocates for the overall principles of preserving the Home Rule authority of local governments; opposing state Preemption; opposing Unfunded Mandates; and protecting against Trust Fund Diversions. A. Beach Funding & Maintenance — Support increased funding and streamlined permitting for beach renourishment and maintenance for coastal counties as beaches continue to be the State of Florida's economic engine and tourism industry driver, attracting visitors and creating jobs. 1028.14 Pacl<et Page -732- 11/18/2014 11.D. Attachment 5 B. Communications Services Tax (CST) — Oppose any legislation that would change the CST, support present CST collections. Loss of CST represents $5 million impact to Collier County. C. Gaming — Continue to monitor the new Seminole Gaming Compact being negotiated by Governor Rick Scott and the Seminole tribe. Support at least three (3) % government share of any future gaming proceeds to finance future infrastructure needs. The Seminole gambling casino in Immokalee has plans to expand vertically. D. Impact Fees — Continue to support home rule authority over administration of Collier County's existing impact fee program. E. Gulf Consortium — Support Collier County's continued participation in the federal RESTORE Act directives, including the State of Florida's Gulf Consortium. Transocean is the only determined civil settlement so far; Collier County is eligible for more than $900,000. The decision of a settlement with British Petroleum (BP) continues in federal court with Phase I11; most recently BP was found to be "grossly negligent" in the Deepwater Horizon tragedy of April 2010. F. Transportation — Oppose diverting funds from the State Transportation Trust Fund to non - transportation projects. A total of $10.1 billion was funded for transportation items for the current FY 2014 -2015. Also, pursue an increased return on dollars for Collier County, a long -time donor county. G. Libraries — Continue to support State Aid to Libraries and the Southwest Florida Library Network (SWFLN). Last session, there was about $34 million in statewide allocations. H. Public Record Requests — Request a legislative amendment to add onto current public records law 119.07(1) a provision that includes Emergency Medical Technicians (EMTs) and Paramedics as exemptions, like firefighters and law enforcement. L Tourism - Protect the current level of funding to VISIT FLORIDA and support increased funding. J. Offshore Oil and Gas Drilling - Continue to support permanently prohibiting of oil and gas drilling in Florida territorial waters, which are within nine (9) geographic miles from the coast of the Gulf of Mexico. K. Uber - Aligning with the Florida Association of Counties (FAC), Collier County supports their new policy statement for the regulation of taxis and limousines, which reads: FAC supports maintaining the integrity of home rule power, which allows counties to regulate taxis, limousines, and jitneys for the purpose of public safety and consumer protection. Conversely, FAC opposes any effort that preempts to the state the regulation of chauffeured limousines, limousine services and drivers of chauffeured limousines. 10.28.14 Packet Page -733- 11/18/2014 11.D. Attachment 6 Recommendations for Construction and Oversight Standards for Inland Oil Drilling and Fracking, Collier County 2015 State Legislative Priorities Construction Standards 1. Review and amend, as necessary, all well and site construction requirements. 2. Amend Rule 62C -29 to require Class II injection wells have consistent permitting, well construction, testing, operational, reporting, and plug and abandonment requirements as those stipulated for Class I Industrial Injection Wells as per Rule 62 -528 Underground Injection Control F.AC., which are more stringent than those required by Rule 62C -29. 3. Amend Rule 62C- 28.004, which requires all tank batteries to be constructed upon sufficiently impermeable pads, to include secondary containment for all fuel, hazardous materials /wastes (including exempted), piping, wastes, and produced water storage tanks to minimize contamination risk to shallow groundwater and surface water bodies. 4. Amend Rule 62C - 27.005(1) to increase the surface casing depth to extend a minimum of 100 feet below the deepest underground source of drinking water (USDW). Currently the rule stipulates that the surface casing be set below deepest UDSW with no specified depth. 5. Amend Rule 62C- 27.005(3) to increase the cement fill of the annular space to whichever is greater, either the static fluid level of the reservoir or 1,500 feet above the uppermost producible hydrocarbon zone being used. 6. Amend Rule 62C- 27.005 (4) to increase minimum surface pressure requirements for the production and tubing and packer to 1.5 times the anticipated static, operational, or planned work- over /well stimulation pressures. Current regulations stipulate a minimum surface test pressure for the production casing and tubing and packer of 1,500 psi and 1,000 psi, respectively. These pressures may not be representative of work -over and production activities for individual oil & gas wells. 7. Establish minimum annular cement thickness for the production casing — similar to minimum requirements for water wells and Class I injection wells completed in Florida or specify API standards or practices. Packet Page -734- 11 /18/2014 11. D. Oversight Standards 8. Add a requirement that the applicant fund an onsite inspector, similar to a construction engineer inspector, employed by FDEP who must witness all of the construction, drilling, fracturing, plugging, and abandonment activities including those activities related to waste disposal. This inspector shall have the authority to stop work. 9. Review all records related to the plug and abandonment of oil wells, especially those in close proximity to existing public water supply wellfields to determine their adequacy to protect water quality. Develop a requirement that if information indicates inadequate protection of the plug and abandonment method used, move forward to reenter and properly plug and abandon the well to isolate all open -hole sections. 10. Identify and develop appropriate regulations to identify and protect the public from the hazards associated with future public water supplies in proximity to wells not plugged /abandoned to current standards. 11. Add a requirement for surficial aquifer monitoring wells around exploration and production wells to be monitored by FDEP. Applicant shall pay the costs of the wells and monitoring. 12. Add a requirement for chemical disclosure statement related to all drilling and well stimulation fluids. 13. Add a requirement that disposal of all solid debris (well cuttings) and heavy drilling fluids generated during drilling and completion of an oil well be disposed at a secure landfill that is permitted to accept industrial waste. 14. Add a requirement that the FDEP's Oil and Gas Section notifies and copies Collier County on all applications, supporting documents, submittal and meeting notices, correspondences related to future oil and gas exploration, oil and gas production, Class II injection wells, and any oil and gas related waste disposal located within or for wells located within Collier County. 15. Develop a requirement to post an increased or additional bond that is sufficient to the cover the costs of site remediation should site or aquifer contamination occur. Page 2of3 Packet Page -735- 11 /18/2014 11. D. 16. Add a requirement that the FDEP conducts a minimum number of annual inspections in addition to the witness requirements addressed in number eight. 17. Amend Rule 62C- 28.005(1) to reduce the reportable spill volume from 210 gallons (5 barrels) to 25 gallons for spills that occur during any oil and gas exploration, production, or completion activities including but not limited to drilling, testing, work - overs. Spills of materials include but are not limited to drilling fluids, produced water, fracking fluids, hazardous and petroleum products, hazardous and petroleum wastes, or materials and wastes exempted from the hazardous waste rules. This amendment would be consistent with existing state regulations for petroleum products not associated with oil and gas exploration /production activities. 18. Add a requirement that backflow prevention devices are installed, working, and tested weekly for all water supplies onsite. Page 3 of 3 Packet Page -736- 11 /18/2014 11. D. September 9, 2014 TRANSCRIPT OF THE MEETING OF THE BOARD OF COUNTY COMMISSIONERS Naples, Florida, September 9, 2014 LET IT BE REMEMBERED, that the Board of County Commissioners, in and for the County of Collier, and also acting as the Board of Zoning Appeals and as the governing board(s) of such special districts as have been created according to law and having conducted business herein, met on this date at 9:00 a.m. in REGULAR SESSION in Building "F" of the Government Complex, East Naples, Florida, with the following members present: CHAIRMAN: Tom Henning Tim Nance Donna Fiala Fred Coyle (Telephonically) Georgia Hiller ALSO PRESENT: Leo E. Ochs, Jr., County Manager Jeffrey Klatzkow, County Attorney Crystal Kinzel, Finance Director Tim Durham, Executive Manager of Business Operations Troy Miller, Communications & Customer Relations Page 1 Packet Page -737- 11 /18/2014 11. D. September 9, 2014 Transportation Disadvantaged Safety Agency of the Year Award. We'd ask Michelle Arnold and Trinity Scott to please step forward. (Applause.) MS. ARNOLD: Commissioners, I want to thank -- for the record, I'm Michelle Arnold, Alternative Transportation Modes Director. I'd like to thank you all for recognizing our award that we receive statewide. We're very proud of the fact that the state recognized the efforts that we're making to transport our residents and visitors as safely as we can. What we were recognized for was a mirror check station that we set up that's unique to the state. All of the drivers are required to pull through the station and make sure that their mirrors are positioned in such a ways that they can prevent blind spots. So we're very honored. And again, thank you for this recognition. (Applause.) CHAIRMAN HENNING: Next item? Item #5D PRESENTATION BY THE FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION CONCERNING OIL DRILLING IN COLLIER COUNTY TO ADDRESS SAFETY ISSUES, LAWS AND REGULATIONS AND FDEP'S CURRENT AND FUTURE OPERATIONS RELATED TO OIL DRILLING WITHIN COLLIER COUNTY. PRESENTED BY SECRETARY HERSCHEL VINYARD AND FDEP STAFF MEMBERS - PRESENTED; MOTION TO DROP THE COUNTY'S LAWSUIT AGAINST FDEP, FORM A PARTNERSHIP WITH FDEP ONCE THEY PROVIDE A LETTER OF COMMITMENT THAT ADDRESSES THE COUNTY'S ISSUES — APPROVED; MOTION Page 21 Packet Page -738- 11 /18/2014 11.D. September 9, 2014 DIRECTING THE CHAIRMAN TO WRITE A LETTER TO COLLIER COUNTY'S LEGISLATIVE DELEGATION TO EXPRESS SUPPORT OF WORKING TOGETHER WITH FDEP AND OTHER INTERESTED PARTIES IN THE DEVELOPMENT OF NEW LEGISLATION REGARDING OIL DRILLING — APPROVED; MOTION FOR THE COUNTY ATTORNEY TO BRING BACK AN EXECUTIVE SUMMARY AT THE SEPTEMBER 23, 2014 BOARD MEETING ON THE PROSPECT OF COLLIER COUNTY JOINING THE LAWSUIT THAT'S BEEN FILED AGAINST THE DAN A. HUGHES COMPANY AND IN ADDITION THE COUNTY ATTORNEY TO NOTIFY AND PROVIDE COUNSEL REPRESENTING THE DAN A. HUGHES A COPY OF THE EXECUTIVE SUMMARY WITH AN INVITATION FOR THEM TO APPEAR AT THE SEPTEMBER 23. 2014 BCC MEETING — APPROVED MR. OCHS: Yes, sir, that takes us to Item 5.1) on the agenda this morning. It is a presentation by the Florida Department of Environmental Protection concerning oil drilling in Collier County, to address safety issues, laws and regulations, and FDEP's current and future operations related to oil drilling within Collier County. We're honored this morning, Commissioners, to have Secretary Herschel Vinyard from the DEP here to lead that presentation. Secretary Vinyard? Good morning, sir. CHAIRMAN HENNING: Yeah, actually, we have two items that are similar in nature. If we can hear both of those and then go to questions by the Commissioners, if they have any. Questions, comments. And I think it's apropos to start with Commissioner Coyle, since I can't see if he wants to speak or not. MR. OCHS: Very good. That's a good suggestion. CHAIRMAN HENNING: Is that okay, Commissioners? Page 22 Packet Page -739- 11 /18/2014 11. D. September 9, 2014 COMMISSIONER FIALA: Sure. COMMISSIONER NANCE: Yes. CHAIRMAN HENNING: Secretary, welcome to Collier County. SECRETARY VINYARD: Thank you, Mr. Chairman and members of the Commission. It's great to be back. Thank you for having me back, and thank you, Mr. Ochs, for inviting me. I certainly want to appreciate the engagement that DEP and many of the residents of Collier County have had over the summer. I think it's been very, very helpful for DEP and hopefully it's been helpful for the folks here in Collier County. I plan to touch on four items for you today relating to DEP's oil program. First is the history of Florida's oil program. Second, protections that are in place to ensure the safety of Collier County's families. Third, additional protections that may be put into place. And finally, an update on DEP's actions against the Dan A. Hughes Company. First the history of oil exploration in Florida. We spoke last time about our shared passion for the national resources in Southwest Florida. And we know that the natural resources in this area actually attract folks from around the country to actually move here and live here. One of the things that I've noticed in my multiple trips to Collier County this summer was a lot of our new residents didn't know that Florida was an oil producing state. Actually, Florida has had a long and safe history of oil production. Over 70 years. In fact, in 1941 the Florida legislature authorized and encouraged oil production in our state. They even put out a $50,000 bounty for any company that could bring in a commercially viable oil well. And in 1943 right here in Collier County the first commercially viable oil well was produced. Where is this oil? There are now two regions in the state where we have commercial oil operations. One right here in Southwest Page 23 Packet Page -740- 11/18/2014 11.D. September 9, 2014 Florida, that being Collier, Lee and Hendry County. And then in the western Panhandle, and that's Escambia and Santa Rosa County. We have a rendering. This is -- I thought this would be important to have a rendering of Collier County's geology. And I wanted to walk through just a couple of basics with you. First of all, Collier County's drinking water aquifer is in the first 1,800 feet below the surface. One of the things I think might be important to note is there's not a giant pool of water underneath our feet. It's actually -- kind of show and tell, what we have is about 1,800 feet of lime rock, rock just like this. And it's a porous rock. If you poured water on this rock it would actually absorb the war. It's kind of like a sponge. And the volume of a rock like that is about 20 percent water. And so your drinking water comes from lime rock just like this. And then below the green line on your sheet you have about two miles of impermeable rock like this. Literally it's hard as a rock. Fluids will not pass this kind of rock. And you have two miles of layers and layers and layers of this rock. And after you get down two miles there is oil in Collier County. And just kind of for your mind's eye, we looked and say well, what's a two -mile distance. And roughly it's from right here in this building to the Collier County Airport, to the Naples Airport. We're fortunate that there is a large separation between drinking water supply and oil that exists in Collier County. I want to highlight with you our permitting program and the permitting protections that Florida law requires to ensure safety for your citizens. First, Florida law encourages the avoidance of sensitive lands, sensitive water bodies and endangered species when locating a well. Second, the well site requires a site pad, like the one shown on the photograph. And before there's any oil drilling at all, the site pad has to be constructed. It's typically made out of crushed rock, and it is a Page. 4 Packet Page -741- 11 /18/2014 11. D. September 9, 2014 barrier between the activities on that site pad and the soil and groundwater beneath it. You might be able to notice in the photograph there's actually also a berm around that entire site pad. And so that if there were a spill that material would be contained on the pad. So it's an important barrier that we require. Another key permitting requirement is significant well casing. And we're going to touch on that in just a minute. Finally, when oil is no longer produced, wells are required to be sealed with cement. They're required to be sealed with cement at multiple depths to ensure the safety of your aquifer. I want to talk a minute about the well casing. It protects our drinking water source as the well moves down through the geology. It's important to note, this is not one casing but five separate casings made of steel and cement, approximately a half -inch thick. So you have redundant protections required by Florida law for any oil well in Collier County. Next slide. I'm particularly proud of this point. DEP has one of the best, if not the best, well to inspector ratios in the country. The -- we have for every inspector -- yes, ma'am? COMMISSIONER HILLER: Wait a second, the slide keeps jumping back and forth. Who's responsible for moving the slide? CHAIRMAN HENNING: Troy's doing that. MR. MILLER: I've lost my PC here. I have no control over it. My PC has gone out so I have no control and I don't know if it's fighting with -- CHAIRMAN HENNING: Can you help? MR. MILLER: Yes, sir. COMMISSIONER HILLER: Can we pause while Troy is -- SECRETARY VINYARD: This is deja vu. CHAIRMAN HENNING: I know, that's -- Page 25 Packet Page -742- 11/18/2014 11.D. September 9, 2014 COMMISSIONER HILLER: Poltergeist. CHAIRMAN HENNING: Technology doesn't like the agency for some reason. SECRETARY VINYARD: All right. There, we're back. And I'll -- Mr. Chairman, I'll start over on this slide. We have one of the best well to inspector ratios in the country. Very proud of this. For every 40 wells we have a single inspector. And what that means is every well is inspected, visited about 100 times a year. Very, very important. I want to draw your attention to the slide. Typically bigger is better. In this case smaller is better. The shortest bar, Florida, means that we have the best well to inspector ratio. You'll see Texas and New Mexico, their inspectors are required to inspect thousands of wells. So in this case Florida was much, much better than our counterparts. Because of the number of inspectors and inspections, we've been able to prevent harm before impact occurs. And that's very, very important to me. We want to prevent the environmental harm before it occurs. But if you break the rules, we have a number of tools in the toolbox. Including revocation of the permit. One tool that we put on this list, and I think it's important in this particular case, is the cease and desist order. When I signed a cease and desist order on New Year's Eve, it was the first time that a cease and desist order had ever been issued in the history of our oil and gas program. So the issue that occurred in Collier County was very, very, very important to me and DEP. So let's talk a little bit more about holding Dan A. Hughes accountable. As you know, our inspector caught Dan A. Hughes Company performing an unauthorized act on New Year's Eve. And within hours, I issued that cease and desist order, which Dan A. Hughes then violated. We then turned the matter over to our enforcement section where Page 26 Packet Page -743- 11 /18/2014 11. D. September 9, 2014 they issued a consent order against Dan A. Hughes, requiring them to spend about $300,000 in testing, sampling, monitoring, fines and penalties. After several months, Dan A. Hughes Company fell behind on the requirements of that consent order. DEP agreed with many of the folks in this room about Dan A Hughes's conduct. We revoked every permit they had in the State of Florida and we filed suit right here in Collier County Circuit Court. Mr. Chairman, I would invite the Commission to join DEP if it wishes in that lawsuit. I've extended a similar invitation to The Southwest Conservancy. DEP is committed to protecting the families of Collier County and the environment here. And while that lawsuit is an important step forward, we're not waiting around for the lawsuit to be completed. We've moved forward. We are taking action. We put together a site investigation team at DEP. As you may know, we've already drilled six groundwater monitoring wells. Fortunately we have not found any contamination at the Collier -Hogan well site. We're also drilling later this month an 1,850 foot well. If you recall from the southwest geology slide, that is at the very bottom of your drinking water aquifer. Let's be very clear, if there is contamination there we will find it. We're also hiring a team of independent experts to perform a comprehensive study on the Collier -Hogan well site. We want to know what happened at the Collier -Hogan well site. As you know, we had not seen that particular process take place before and so we want to have outside experts to advise us on what happened to your geology and what happened to your groundwater. And after we get the scientific data back that the team of experts will produce, we will let science then dictate what steps we should take Page 27 Packet Page -744- 11 /18/2014 11. D. September 9, 2014 with respect to your groundwater, with respect to Dan A. Hughes Company, and what potential statutory changes may be in store next year. Along the way I want to make sure that we receive your input. We would like to be partners in this process. These commitments that we've discussed in the previous slide with respect to the studying and monitoring, testing, and lawsuits, we have also communicated that to Southwest Conservancy. And we appreciate their engagement throughout the summer on this. As we continue to focus on the activities at the Collier -Hogan well site, DEP is also engaged in coming up with ideas to present in this legislative session to strengthen, strengthen DEP's regulatory authority. We will not be encroaching on local zoning authority. We think it's important for local governments to determine where oil wells can be placed in your community. But we see several items where we believe DEP needs greater authority. We think that we should be able to consider the past history of out -of -state violations for applicants seeking permits in Florida. If you're a bad actor in another state, we don't want you in Florida. We want to increase fines for oil companies. DEP wants to be able to fine an oil company more than $10,000 a day. We want to increase the scope of our inspection requirements. We want to use the latest technology for 24/7 monitoring of every oil well in Florida. Finally, increased bonding requirements. If a cleanup is required, the company, not the taxpayers, should be financially responsible for that cleanup. Again, Mr. Chairman, members of the Commission, I would appreciate and welcome your input and partnership with what's going on in the 2015 legislative session, and again, thank you for having me Page 28 Packet Page -745- 11 /18/2014 11. D. September 9, 2014 There being no further business for the good of the County, the Z) meeting was adjourned by order of the Chair at 5:53 p.m. BOARD OF COUNTY COMMISSIONERS BOARD OF ZONING APPEALS/EX OFFICIO GOVERNING BOARD(S) OF SPECIAL DISTRICTS UNDER ITS CONTROL OM HENNING ATTEST: DWIGHT`E� BR6K, CLERK hest as to Cha'i 7man signature only. These minutes approved by the Board on 2L)tq as presented or as corrected Transcript prepared on behalf of Gregory Court Reporting -n Incorporated by Cherie' R. Nottingham, CSR. Z� Page 267 Packet Page -746-