The Oklahoma Oil and Gas Association on Tuesday sued the Kingfisher County Commissioners, escalating a monthslong fight over how water is transported throughout the county.
Oil and natural gas producers until earlier this year used temporary pipes in ditches along county roads to transport produced and treated water to new oil and natural gas wells for use in hydraulic fracturing operations.
Kingfisher County Commissioners in May banned the practice, approving only fresh water though the pipes. Oil and natural gas industry representatives say the change could add millions of dollars in costs, significantly increase truck traffic and increase the use of fresh water when companies previously relied on recycled oil-field water.
The legal challenge focuses on jurisdiction. The oil and gas association filed the lawsuit at the Oklahoma Supreme Court, claiming the county actions violate state law that gives the Oklahoma Corporation Commission exclusive jurisdiction over oil and natural gas operations.
“We’re asking the Supreme Court to declare the Kingfisher County permit invalid and instruct them that it is beyond their jurisdiction,” Chad Warmington, president of the Oklahoma Oil and Gas Association, said in an interview Tuesday.
“We also want some guidance letting them and other counties know those are issues that are exclusively Corporation Commission jurisdiction. We feel that’s pretty clear, but guidance would be helpful in working with other counties.”
Kingfisher county officials did not respond to phone calls and emails from The Oklahoman on Tuesday.
Negotiations break down
Companies in Kingfisher County have been operating under 90-day permits. With the new rules in place beginning in May, the final permits under the old system are phasing out this month. County and industry leaders have been meeting since spring to resolve the issue outside of court, but industry representatives filed the lawsuit Tuesday after it became clear the negotiations were not working, Warmington said.
“We didn’t feel there was any other avenue to explore,” he said. “We also have other counties looking into the same thing, raising concerns and considering potential rules or changes in their own counties. That’s when we said we have to get this resolved.”
The conflict centers on the use of water in temporary pipes placed in county rights of way, in the ditches along county roads in Kingfisher County. Oil and natural gas companies typically use permanent buried pipe to transport water throughout their operating areas, but they generally rely on temporary pipes to connect the network to new wells for the drilling and completion process.
But Kingfisher County commissioners say they discovered only this spring that companies have been using the temporary pipes and hoses to transport water of various qualities. New county rules implemented in May allow permits only for fresh water. County officials say the restriction is needed because of concerns over liability for the non-potable water.
“The water is dangerous. It destroys whatever it touches,” Kingfisher County Engineer Heath Dobrovolny said in a July interview. “When you put that stuff in the right of way, you’re giving easy access to the general public where, either by accident or vandalism, there can be a problem. The commissioners’ concern is exposure to liability and exposure to public safety with produced water.”
Most of the water transported through the temporary pipes has been treated to the point where it can be used in hydraulic fracturing operations, oil and natural gas industry representatives said. Without the ability to use treated water, those companies must use fresh water.
“We could be using a half-million barrels of recycled water at a time, but we will have to use fresh water instead,” Warmington said Tuesday. “That doesn’t make a lot of sense when the state wants us to use recycled water, and we have the ability to use recycled water.”
If operators were to transport produced water by truck instead of temporary lines, a typical six-well development operation would require an additional 20,000 truckloads to haul the water, the industry association said in Tuesday’s lawsuit.
The Legislature in 2015 passed Senate Bill 809, giving the Oklahoma Corporation Commission exclusive jurisdiction over regulating the state’s oil and natural gas industry. Kingfisher County officials say they are not regulating the industry, but that they do have jurisdiction over the use of county rights of way.
“Nobody is arguing the Corporation Commission doesn’t have the authority over oil and gas industry,” Dobrovolny said. “We don’t believe they have the authority over roads and rights of way. That was granted to the county commissioners. They are chartered with maintaining a public road and right of way for public safety. This particular issue with produced water poses more risks and liability to the general public in the right of way.”
Oil and natural gas industry representatives say that by restricting what kind of water is allowed in the rights of way, county officials are regulating the oil and gas industry.
“We’re not disputing they have the right to issue a permit and charge for a permit. That is a clearly laid-out role of the county commission,” Warmington said. “What they don’t get to determine is what’s in the line. That’s specifically left to the Oklahoma Corporation Commission. We’re arguing the county commissioners don’t have the right to permit what’s in the line.”
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