Permian basin at risk of poisonous water leaks, warns Texas regulator
(Bloomberg) – Texas regulators are warning that wastewater from fracing in the biggest U.S. oil basin is causing a “widespread” increase in underground pressure — a development that risks hindering crude output and harming the environment.
Shale oil wells in the Permian basin generate millions of gallons of chemical-laced water, which drillers then pump back into the earth. Landowners and activists have said for years that this process causes toxic leaks. Now the state’s powerful oil and gas regulator, the Railroad Commission of Texas, is acknowledging the scale of the problem and imposing restrictions that could increase crude production costs.
Chevron Corp., bp Plc, and Coterra Energy Inc. as well as water management specialists Waterbridge Operating LLC and NGL Energy Partners, are among the companies that have received notices about the pressure issue from the Railroad Commission of Texas, according to a Bloomberg News review of public records. The RRC sent the messages to companies applying for new wastewater disposal wells.
Producers began injecting more water into shallow rock formations roughly five years ago after pumping it deep below the surface was found to trigger earthquakes. But the volumes are now so large that the dirty water is breaching wells and causing the ground to swell and rupture, threatening to contaminate drinking supplies for people and livestock.
Restrictions on both deep and shallow injection zones could mean producers will have to pump their wastewater farther afield, increase recycling or pay to clean it up. All of these options would add to costs in the Permian, which accounts for about half of America's total crude production. It would be the latest blow to US producers already grappling with low oil prices and a shrinking inventory of top-tier drilling sites, despite President Donald Trump’s pledge to unleash U.S. “energy dominance” by backing fossil fuels.
The RRC has updated its standard language in the letters to producers in a nod to the severity of the problem. It now says that disposing wastewater into the Delaware Mountain Group rock formation in the prolific western part of the Permian “has resulted in widespread increases in reservoir pressure that may not be in the public interest and may harm mineral and freshwater resources in Texas.”
“Drilling hazards, hydrocarbon production losses, uncontrolled flows, ground surface deformation, and seismic activity have been observed,” the commission says.
Starting next month, the RRC will place limits on water-pressure levels due to “the physical limitations of the disposal reservoirs.” It will also require operators to assess old or unplugged oil wells within half a mile of the disposal site, twice the previous distance.
Spokespeople for bp and Coterra declined to comment. Representatives for bp, Waterbridge and NGL didn’t immediately respond to requests for comment.
