Read INSPECTOR Field Inspection Guidleline ­ Wyoming State Lands text version

INSPECTOR Field Inspection Guideline ­ Wyoming State Lands Wyoming Office of State Lands & Investments ­ Mineral Leasing & Royalty Compliance Division ­ Field Inspection Section Issued April 17, 2006 Revised: , 20 Inspection Coverage This guideline is intended to assist the field inspector and State Mineral and Surface lessees regarding the required surface conditions and production handling and accounting for State lease mineral production, principall y, oil and gas. Well locations/Sites/Pads: *Upon visiting a lease classified as operating, confirm that the actual drilling of well has occurred and is complete and that the leasehold surface is being properly maintained. *Review any pertinent Application for Permit to Drill (APD's), Sundry Notices and Completion Reports(s) to establish history/status of wells on lease. *Confirm that listed wells are actually completed as reported, i.e., that equipment is functioning on-site and effluent is issuing from well bore. *A "completed well" should be drilled to depth as per the filed APD and equipped with a well head at a minimum. Consultation with the operator regarding production status should occur pursuant to controlling lease status. *If there is no wellhead or if there is a question about the completion regardless of the presence of a wellhead, run a wire line down the well to a depth of at lease 15% of the total stated depth of the well per the completion report. *Determine that good cement has been returned to the surface in the annulus between the casing and bore hole wall and that surface casing has a good cement "set". *Confirm satisfactory surface conditions at the drill site. *Confirm that drilling fluid pits are lined and fenced. Is there a permit from the W.O.G.C.C. for the pit(s)? If so, was pit lining required, and if so, in place? *Is there a contingency plan which includes coverage of the pit(s) contents in any emergency at the site, including but not limited to weather events? If not, one should be requested as in place in the field office of the operator. *Is the pit designed to reflect a minimum of 2' of free-board at the fullest capacity contingency for the pit? If not, provide request for pit redesign to meet this standard.

*Is there any surface water or water wells within 300' of any on-site pit placement? Again, pits present should be lined in such cases. *No trash, hydrocarbons or drilling fluids should be evident on the surface of the pit(s) or indicated by the conditions of the surrounding area that same may have been buried on site upon completion of drilling operations. *Operating well pad/location should be reclaimed to as small as possible in size, including contouring and seeding. *For reclamation of proposed wells never drilled by locations built ("EP" wells on WOGCC site). Assure no surface disturbance exists without reclamation. No trash/refuse should be present on site. *For reclamation of wells drilled and abandoned, the above requirements are applicable; and, a plugging record should be available indicating the "set" depth for all cement plugs and the number of sacks used in the hole. If there is a standpipe visible, assure that there is cement in the pipe by visual or tapping on pipe. *A dry hole marker should be evident. The casing should be cut off to plow depth (no shallower that 3' deep) below ground level and an identification cap in place. Oil Production Operations Layout: *Identification of Equipment ­ Note what equipment is being used on the lease site, whether at a well location or elsewhere, related to mineral extraction and movement activities. What equipment relates to on-lease and off-lease production? *Assure all wellheads (flowing, rods, gas/injection lift, submersible pump) in place and all valves and fittings in good order. Pump-jack fenced on rod production. * Assure flow lines are identified and in good condition. All lines entering or leaving the lease production storage or wellhead area should have sealable valves and same should be sealed as appropriate to the operation occurring when on the lease site for the inspection. Check seal numbers against seal register. * Determine that treater/separator is properly maintained and operable without spillage around same from leaking seams/connections. No filthy hay or hydrocarbon-soaked fillers on ground around treaters and no hydrocarbon stains present. If there is hydrocarbon spillage and staining, determine the depth and area boundary of same and require operator to cleanup by removing the contaminated soil and not leaving/placing/burying same on State lease site. *Confirm battery tanks are strapped and strapping table existent for non-LACT batteries. Tanks should have positive pressure vacuum devices installed and pressure/vacuum thief hatches or vent line valves. Tanks should not be vented directly to the atmosphere

without passing through a pressure/vacuum relief assembly. Tanks should be set on level ground and appropriately "contained" within a secondary containment boundary. Tanks should be marked with gauge referencing point if they are non-LACT. *No by-passes whatsoever, should be present without evidence of such an authorization. *For LACT installations, all LACT's should have tamper resistant/non-re-settable totalizers and not be by-passed through any connection. The sample probe, sample volume control, sampler containment pot, back pressure valve and meter head/assembly should be sealed unless proving. Equipment Usage. *Note what equipment is being used on the lease for production and treating and is it properly connected. Confirm any reason for any gas by-pass whether for firing on-lease equipment or other. *Determine the fuel source for any on-lease production use for "firing" lease equipment. * Determine if the appropriate equipment for the production operations on the site is present, i.e., sizing for volumes produced? *If there is no treater present, review "gun-barrel operation (single/dual tanks) for water handling. There should be no drainage of settled production onto ground or inside tank site diking to remove water without DEQ permit for NPDES/WPDES, surface or groundwater. Inform producer it is preferable not to drain tankage within the dike area and/or on the ground around the battery area. *If storage/battery tanks are full, or nearly full, is the production being held due to production rate or mishandling? *Are tank batteries solidly supported, not on eroding ground? *Identify the condition of the on-lease equipment as good to old, to junk, in terms of operability, in terms of operations without possible production loss or injury accident? *What are the SPCC (Spill Prevention, Control and Counter-Measure) plans and site configuration/status? Obtain a copy of the plan and match to the physical status on site. Take pictures of problem issues to be corrected, and, generally of the site, for future reference/use. Gas Production Operations Layout Identification of Equipment

*Are wellhead(s) in place and all valves and fittings operational for all wells on lease? * Are flow lines identified and in good condition? *Are gas meter runs straight and of sufficient length to allow laminar flow? Is the gas meter station card information present and gas meter operating if well is on for each well on lease?. *If using a paper chart, assure that pens are working and in the outer 2/3rds of chart. *Obtain or confirm meter testing/proving schedule ­ are these occurring as per contract? Equipment Use *What equipment is being used on the lease for production and treating and is it properly connected? Assure the reason for any gas by-pass whether for firing on-lease equipment or other. *Is the appropriate equipment for the production operation on the site? *Is the condition of the equipment good to old, to junk, in terms of operability. *What are the SPCC plans and site configuration/status? Obtain a copy of the plan and match to the physical status on site. *Take pictures of problem issues to be corrected and generally of the site for future reference use. Lease Terms: *Make sure lease surface is being used for what is applicable under the issued lease terms and that other types of usage are not occurring on the lease, eg., equipment/material storage, housing, camping, dumping, discharging, mud-bogging, four-wheeling, etc. Wyoming Oil and Gas Conservation Commission (WOGCC)/Office Field Requirements: *Well/Lease Identification ­ Make sure well signage has the following: Assure lease identification relates the correct lease operator or company name; that the Legal description reflects ¼¼ S-T-R, and that the lease number or federal unit number, or both are referenced; and, that the well name and number are correct as per O.G.C.C. records and that the proper county designation is noted.

*Review well record(s) on web site regarding any Commission orders or issues, e.g., a required mechanical integrity test for casing integrity, plugging orders, bottom hole pressure testing or work-overs. For pits present, assure: *Permit Signs (SEO or NPDES discharge) present and correct. *Pit is permitted for use, e.g., drilling, production, emergency or work-over. All are different and not to be used for anything but designated. Note whether there is enough freeboard in the pits to handle the projected fluids where drilling or work-over operations are going on. * Pit is free of hydrocarbon or chemical accumulations * Pit is fenced *Status of pit(s) is lined or unlined, and appropriateness of found status. *If pit is netted/flagged; definitely netted if fluid has any hydrocarbons or hazardous contents within. Oil Tanks *Make sure production and water tanks are within a dike (secondary containment) structure with enough internal volume to hold at least the total volume of largest tank within the dike area. *Make sure thief hatches not leaking and that there are no other leakage points on the tankage present. * Make sure vent lines with operating vent valve and VRU (Vapor Recovery Unit) are present. Make sure site is clean of any spilled product on out side of tank or ground surface. Metering/Production Measurement: Liquid metering *For production tank shipped by hand directly to pipeline or transport, assure: *Tank strapping chart number stenciled on tank(s). *That there is proper sealing of all production tanks.

*That the tank chart on location or Production Office LACT (Lease Automatic Custody Transfer) *Assure proper sealing on all components to LACT unit *Assure the proper Installation of LACT Unit *Assure proper sealing of all production tanks. Gas Metering Chart Meter *Assure that paper chart is operating within allowed ranges, preferable running in upper 2/3 of Chart. *Note well identification, date and Meter # *Establish that no By-Pass lines that do not have authorization. * Establish that the last meter station calibration card is either at meter or Production Office. EFM (Electronic Flow Meter) *Note well identification, date and Meter # *Establish that no by-pass lines exist without authorization. *Establish that the last meter station calibration card either at meter or Production Office. Hazardous Materials: * If chemicals are being used on lease, assure: *That chemicals are preferably within Secondary Containment, i.e., diked area. *That all lines and pumps free of leaks, drips or spills. *That all chemical containers on lease have labels identifying contents. *Any barrels, drums or containers that are on location and unidentified should be brought to the attention of the lessee's field office or operator; and, the Wyoming DEQ

should be informed if there are any suspicions of the contents. Do Not move or come physically in contact with the suspicious containers. Oil Spills or other Contaminants *Assure that all well site and facility locations, right-of-ways and access roads are free of oil, hydrocarbons and contaminants. Authorized use of hydrocarbon "tank bottoms" for road application should be available where same has occurred on lease. *All spills that fall under WOGCC, BLM, Coast guard or other agencies shall have a Spill Report on file at the Production Office. Idle Equipment: *Assure that no idle equipment is on Wyoming State leases unless it is going to be used in the near future for production operations, e.g., rods/tubing/casing for new well or repairs. *No junk, trash, drilling refuse or flotsam should be on the lease. Roads: Assure/confirm the following regarding State land lease/access roads: *That these are properly maintained to allow ingress and egress without resource damages. *Roads should be constructed to best management practices standards ­ see Office roadway manual. *Using the template below regarding roadways on State lands, assure as close as possible conformance therewith. Right-of-Ways: *All Right-of-Ways shall be reclaimed and reseeded as soon as practicable after initial use is completed. Power Lines and Electrical Equipment: * All power lines erected are maintained and in safe working condition. *Lines shall be marked by identification post should same be underground. *Electrical Equipment shall provide maximum safety protection for humans and livestock. Power lines and equipment shall be Installed to provide protection for from any energized sources on the lease.

*All electrical installations must meet the requirements of the National Electric Code. Pollution *There shall be no un-permitted emissions or un-permitted discharges from or onto/into Wyoming State Lands surface or sub-surface. Well/Lease Abandonment: Well/Lease Abandonment *There should be filed and approved Sundries with WOGCC on plan of abandonment. *Abandonment must be performed with WOGCC witness. *All facilities, equipment, tools, pipe, buildings, power lines, transformers, chemicals and trash/junk must be removed from the State lease. No burying of anything in State land unless specifically authorized. *Operators/lessees must reclaim and rehabilitate all locations to as near the natural surrounding contours as possible, including rights-of-way and access roads. Reseeding should be accomplished with a seed mixture recommended by the local soil conservation district. Safety: Vehiclular *Wear Seat Belt at all Times ­ this is a State law. *Always employ good defensive driving skills (look out for the unforeseen). *Maintain vehicle in good operating condition. Well Location and Production Facilities *Wear safety-toed footwear, safety glasses, atmosphere monitors, hard hat, and where appropriate, fire-retardant clothing. *Before moving in a confined area, look up-down-behind-inside *Never enter into an area with unknown hazard *If not sure about any facility or equipment, ask the operator about, as your life depends on Knowing.

Reclamation: *All site reclamation and rehabilitation shall be done with good workmanlike practices. *All site re-seeding/re-vegetating shall be accordance county Soil Conservation District recommendations. Roads Annex: CONSTRUCTION, MAINTENANCE AND RECLAMATION OF ACCESS ROADS ON STATE OF WYOMING SURFACE There are many reasons to enter, build roadways on, and use State of Wyoming surface. However, such use is not without requirement to protect the State surface. As such, this surface roads guideline will be the handbook document with which compliance must comport. Negative issues related to roadways on State lands usually result from insufficient preplanning for the road building activity, resulting in: inadequate/improper road surface drainage; accelerated erosive action around culvert and bridge fills; poor soil compaction and placement; poorly installed water feature crossings; and, poor overall grade affecting drainage. This handbook is provided as a reference for minimal road standards for construction, use/maintenance and reclamation. Preparation and construction for such roadways should take into consideration the calculations necessary to plan for handling flood conditions as related to road layout. Rules of Thumb: Pre-plan, consult with surface lessee and identify problems up front and use best management techniques/practices the first time the road is built if non-existent and when any road must be upgraded on State lands. Use existing two-track roads if they are sufficient for the purpose intended and environmentally safe. Construct as few roads as possible on State lands and in constructing, use the minimum length and width necessary for the intended purpose. Locate roads away from drainage bottoms, riparian areas and environmentally sensitive ground. Stabilize the road location in its entirety. ROAD PLAN, DESIGN AND LOCATION In discussion with mineral and surface lessees, make sure the following information is conveyed and/or understood in terms of satisfactory road-ways on State land surface: *Apply road plan based on the knowledge of the overall project which such road is intended to accommodate and be a part of, and facilitate those plans and amendments thereto pursuant to prevention of injury to the surface right of way and to users, e.g., for

the mitigation of potential situations/adversities from flood, wind, snow, fire, improper gradient, short curve radius, vehicle use types and design speed. *Plan to minimize soil and water resource impacts to the maximum. *Attempt to effect road placement such that visual impacts to the overall landscape are reduced as much as possible/practical. *Design all roads built on state lands to drain naturally by out-sloping or in-sloping with cross drainage at right angles and with appropriate grade and evevation. *Roads should be "fitted" to the topography of the area to be served by locating on natural benches and natural contours with stabile soil characteristics. *Avoid slumps and slide areas with steep slopes, clay soils, concave slopes and rock layer areas that dip with the slope. *Avoid road building in all wet areas, riparian zone, meadows and natural drainage channels, and wherever located within 100 feet of any stream, creek or ephemeral water way, make sure there is sufficient buffer through water barriers and deflectors to channel the run-off away from these natural areas. *Avoid as much "Cut and Fill" work as possible. *Design the road with adequate features so as to prohibit or discourage vehicles from leaving the established roadway. *Design the road surface to accommodate all weather activities if that is what it is to be used for; design the road with adequate travel way for vehicle passing without leaving the road, and for single lane/tract roads of a permanent nature; place turnouts equidistantly every 750 feet. Design roads with the minimum acceptable grade allowable for the distance traveled, i.e., rounding a curve or accessing a significant rise in the terrain/road bed; further, design curve radii based on the speed design for the road and where terrain restricts an acceptable curve radius, increase the road bed width in the curve in such areas. ROAD CONSTRUCTION-WIDTH, CUT AND DRAINAGE *As a rule of thumb when repairing or expanding existing roadways, do not disturb more land than necessary; and, curtail dirt moving activities when the soil is web. Finish started work to allow for proper slope, drainage issues and the like, prior to leaving a project for the winter season. *Minimize site erosion, stabilizing the work area as much as possible through seeding exposed ground (cut and fill/borrow areas) with a seed mixture approved by the office; by possible hard surfacing and road bed; or, through compacting, mulching and

terracing. *In working a road project, locate overburden and wastes associated with the work in such locations so as to not provide a vehicle for entry through run-off into the waters of the State or America. *Construct road crossings at right angles to all riparian areas to minimize disturbance. *Full benching should be used on side grades in excess of 50% slope. *Provide for adequate drainage through appropriate use of crowned roads or outsloped roads where cut and fill construction techniques are applicable. *Use properly located water bars (barriers) where appropriate. *Where at all possible, install culverts at the gradient of the original ground slope. *Angle ditch relief culverts to equal 20-30 degrees toward the in-flow. ROAD MAINTENANCE *As a rule of thumb, assure proper and timely maintenance or roadway erosion control features, making sure dips, culverts and cross-drains are debris-free; that ditches and barrow areas are properly repaired and clean and that culverts are marked for easy locating. *Grade road surfaces only as often as necessary such that the surface remains safe and stable and to assure the continuance of proper drainage. *Never side cast material in any area which may find its way into the natural drainage pattern in the area of the road. ROAD RECLAMATION *As a rule of thumb, if a road has no beneficial use beyond that determined at its origin and it is not necessary to have said road for other operations on the property surface, then the road must be reclaimed. *Reclamation of roadways will require one or more of the following: re-contouring to the original contour of the area before the road was constructed; re-contouring in selected areas; or, re-contouring to blend with the natural contours and drainage in the area. *All reclaimed areas should be re-seeded with an agency-approved seed mixture. *Produced Water Management

When handling production water on State lands, the following Minimum Requirements should be confirmed as met by the entity handling the water: 1. State oil and gas lessees (producers/operators) must provide the Office of State Lands and Investments with a water management plan prior to the discharge of any CBM well produced water, and be prepared to make any changes necessary as called for by the Office pursuant to the protection of State lands and lands affected by water discharge, off lease. The water management plan and any updates must be discussed with the State's grazing lessee at a minimum, pursuant to avoidance of any adverse impacts on State grazing lands or grazing lessee operations. Water should be routed to established drainages in a manner such that erosion and water standing/impoundment does not occur unless such impoundment is considered a beneficial use. Where practicable, water discharge lines and gas lines should be laid in the same excavation/cut to minimize surface disturbance. Where practicable, water discharge lines should be linked for as many wells as possible, to a common discharge point. If such points are off-lease, appropriate consultation with the surface owner and responsible regulatory agencies should be effected. Water should not be discharged onto playas and flat areas where drainage/percolation is not effective. Grazing land may not be inundated with standing water to the impairment of grazing operations/use. A plat of the development area, i.e., well sites, facilities on lease and drainage routes and means, i.e., piping natural draw and the like, must be submitted prior to operations commencing for de-watering. A copy of the NPDES Permit application filed with the Wyoming DEQ ­ Water Quality Division must be submitted. No "misters" maybe used on State Land Surface to apply CBM-produced water.

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