Submitted by Nick Cunningham via OilPrice.com [4],
The recent spike in earthquakes in Oklahoma could present a “game changer” for regulators.
That is how regulators themselves described the spate of earthquakes that struck the state between June 17 and June 24, according to Reuters [5]. Oklahoma has become the most seismically active state in the country in recent years, with a lot of scientific data pointing to the practice of disposal wells as the culprit. Earthquakes with a magnitude of 3.0 or greater have jumped from 20 in 2009, to 585 in 2014. But 2015 could be even worse – if current trends continue, the state could log more than 800 for the year.
[6]
The rapid increase in seismic activity prompted new regulations, after a long period of hesitation on behalf of the state, which took effect two months ago. The rules [7] barred drillers from injecting wastewater past a certain depth underground, a threshold that seismologists believe contributes to earthquakes.
But even with those rules in place, earthquakes have not stopped. Over the past week, an estimated 35 earthquakes of a magnitude of 3.0 or greater struck the state.
That has the Oklahoma Corporation Commission, which regulates oil and gas drilling, looking again at regulations. “We have to approach it anew,” an OCC spokesman, Matt Skinner, said after the latest round of quakes, according to Reuters. “There's been a huge increase. That's a game-changer.”
The surge in earthquakes over the past week comes as a June 23 report from E&E [8] that showed that the University of Oklahoma sought a $25 million donation from famed oil executive Harold Hamm, head of Continental Resources. The university pursued his donation as it was also establishing its position on the connection between earthquakes and disposal wells. When completed, their position reflected Hamm’s pretty closely, although he ultimately declined to donate (he is still one of the university’s largest donors). E&E notes that there is nothing specifically linking the donation to the university’s position, but they took place at the same time.
The skeptical approach the university took to earthquakes may have delayed action. The news comes after months of speculation that the Oklahoma Geological Survey, which is part of the university, sat on seismology data that linked disposal wells to the rise in earthquakes over concerns that it would affect the state’s top industry. Oil and gas account for 7 percent of Oklahoma’s state revenues. There has even been speculation that seismologists were pressured [9] into downplaying the connection.
The rate of earthquakes has become too hard to ignore. In April 2015, the Oklahoma Geological Survey took a much stronger position [10] on earthquakes, saying that it “considers it very likely” that much of the uptick in seismic activity is caused by disposal wells. The state government even launched a website [11] with data and information on how disposal wells are contributing to quakes.
But the latest round of earthquakes suggest that the state is still not moving forcefully enough despite new regulations this year. For now, the state has not opted for a moratorium on disposal wells in sensitive areas, as other states have done. Regulators at the OCC had hoped that its light touch would help reduce the frequency of earthquakes over time, and meanwhile, it could gather more data. That approach may not be sufficient. But there is not a lot of appetite within the legislature to kill the goose that lays the golden eggs.
On the other hand, if there is a larger catastrophe, the state would have no choice but to finally crack down.
“If there is damage and loss of life, you will see the political climate absolutely change overnight,” cautioned Jason Murphey, a Republican representative in the state legislature, according to Reuters. “When and if that happens, you will have a cloud that hangs over the energy sector for the rest of our lives.”
