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WS Item 3ABCGas & Oil Well Drilling City Council Work Session CP 07-005 Ordinance 480-RRR Ordinance 880-A November 20, 2007 Presentation Outline Background (Land Use Plan, Ordinances, Drill Process) Pending Issues City of Burleson Site Visit City Council Comments/Questions Proposed Changes Amendment to the Land Use Plan to establish a policy on natural resource protection and site design standards for Gas and Oil Drilling and Production sites as appendices to the plan Amendment to the city’s Zoning Ordinance (SUP section) Amendment to the City Code Drilling Process Drilling Rig Hydraulic Fracturing Refracing Horizontal/Directional Drilling Well Completion and Clean Up Drill Site Production Site Production Well Head Issues Pending Location of the Separator Tanks Distance Requirements (Structure & ROW) Frac Ponds Road Repair Agreement Burleson Site Visit 2 Council Members Deputy City Manager Assistant Director of Public Works Fire Marshal Planning Official Engineer Gas & Oil Inspector Recommendations Conduct training (Police & Fire) Hire a full-time gas inspector Utilize RRC GIS maps Require Gas Companies to meet with neighborhood groups Hire a Gas Inspector Background City adopted zoning and city code ordinance amendments in October of 2004 to address oil and gas drilling that included SUP requirement Gas well permit required to meet the technical standards Road Repair Agreement Current Process Zoning Ordinance Amendment 480-YY Amended the SUP section to allow operations in the I-2 district & provide specific regulations for operations. City Code Amendment Addresses technical operations and maintenance standards such as emergency processes, security, environmental protection, insurance, requirements, etc. Basis for the Revisions Update ordinance (3 years since the last revision); Provide a framework through the City’s Comprehensive Plan to evaluate SUP requests; and Provide reasonable access to mineral resources while minimizing impact on adjacent land uses and environmental resources. Proposed Comprehensive Plan Approach to Oil & Gas Drilling Southlake 2025 Plan Provides rational nexus for the following: Location Operation Permit Issuance. Specific Use Permit (All non-residential districts) Evaluation Criteria Oil & Gas Ordinance/ Road Repair Agreement Permit Proposed Changes Amendment to the Land Use Plan to establish a policy on natural resource protection and site design standards for Gas and Oil Drilling and Production sites as appendices to the plan Amendment to the city’s Zoning Ordinance (SUP section) Amendment to the City Code Southlake 2025 - Land Use Plan Amendment Establishes overarching policies on natural resource extraction within the framework of the city’s Comprehensive Plan (Appendix C) Establishes site design standards for drilling and production pad sites (Appendix C-1) Proposed Land Use Plan Amendments (Policy on Natural Resources) Street or Highway Access Minimize impacts on surrounding properties Minimize impact on natural features (Environmental Resources Map) Demonstrate coordination between the surface owner and mineral estate owner. Reclamation Techniques Site Design Standards (Appendix C-1) Standards for “High Visibility” and “Low Visibility” Sites with respect to fencing and landscaping Standards to be met during drilling and during production Hardscape Fencing & Gates Landscaping Color Access driveways Fencing and Landscaping High Visibility Sites Adjacent to and visible from major roadways, existing commercial and residential development Have availability of water for irrigation purposes Masonry or a combination of masonry and wrought iron Low Visibility Sites (8’ articulated masonry wall with gate) Not adjacent to existing development Limited availability of water for irrigation purposes Gas Well Production Proposed Changes to Ordinance 480-RRR Gas Drilling & Production allowed in all Non-Residential Zoning Districts with a Specific Use Permit (SUP) Additional submittal requirements include: Indicate all existing and future easements Pooled area Demonstrate compliance with the Natural Resource Extraction Policy in the land use plan (Appendix C) Compliance with fencing and site design standards in Appendix C-1 of the Land Use Plan Proposes Changes to Ordinance 880- Oil & Gas Application Fee ($15,000 – Gas & Oil Permit); ($5,000 for SUP); and ($7,500 balance for each well); Residential Distance Setback (Currently 600’-Proposed 1,000’); Public Building Distance Setback (Currently 1,000’-Proposed 1,500’); Proposed Changes to Ordinance 880- Oil and Gas 8’ Masonry Wall consistent with the conditions of the SUP; Noise – Determine pre-drilling ambient level; Prohibiting combustion engines; Type of system (Closed Mud loop); Pipeline location (New construction, mapping); 480-RRR P&Z ACTION: September 6, 2007; Approved (6-0) subject to a minimum 600’ distance from all structures; permitted in all zoning districts; provide more information/recommendations regarding distance criteria. Questions? Current Ordinance Potential Area Available = 576 acres (approx.) Option 1 Potential Area Available = 176 acres (approx.) Option 2 Potential Area Available = 131 acres (approx.) Seek Advice from the Attorney Regarding Possible Updates to the Oil & Gas Regulations Oil & Gas Drilling Ordinance At the June 6, 2007 City Council meeting staff presented responses to Mayor Pro Tem Carolyn Morris questions and presented the distance requirement analysis. Technical Questions Oil and gas production lines can not exceed 100 psi and be buried 6’ depth. No open flow testing is allowed. All well lines must be equipped with high/low pressure shut off valves. Each producing well must be equipped with a down hole shut-off valve storm choke. Other Questions Continue to require access to wells and drill sites must be from state or federal highways? Continue to require I-2 zoning? Increase distance requirements to a 1,000 ft. for residential and 1,500 ft. for school, church, day care and public buildings? QUESTIONS Background City Council requested that staff evaluate possible changes to the gas & oil drilling ordinance presented by Mayor Pro Tem Carolyn Morris 2004- Ordinance Amendment Process Zoning Ordinance Amendment 480-YY Amended the SUP section to allow operations in the I-2 district & provide specific regulations for operations. City Code Amendment Addresses technical operations and maintenance standards such as emergency processes, security, environmental protection, insurance, requirements, etc. Comments/Questions Can the city increase the $2,000 per day fine? - State law provides a maximum penalty of $2,000 per day per violation of a city ordinance regulating public health and safety. Who issues the final permit? - SUP (PDS); Grading Permit (PDS); Road Repair Agreement (Public Works); Drainage Plan (Public Works); oil & gas permit (staff, city council, oil & gas consultant ???). Comments/Questions Continue to allow drilling only in I-2 zoning? - By restricting gas drilling to a limited area of the city increases the likelihood that a legal challenge may be levied alleging a compensable taking. ADDITIONAL SLIDES Area = 27 Acres Owner: Shamrock Logistics Current use: Ground Fuel Storage tanks Parcel 1 Back to Map Area = 14 Acres Owner: Explorer Pipeline Co. Current use: Ground Fuel Storage tanks Parcel 2 Back to Map 3 4 6 5 S.H. 26 Parcel 3 Area = 15.5 Acres Owner: Alon USA Refining, Inc. Current use: Ground Fuel Storage tanks Parcel 4 Area = 5.7 Acres Owner: Alon USA Refining, Inc. Current use: Vacant Parcel 5 Area = 1.2 Acres Owner: Explorer Pipeline Co. Current use: Storage related support Parcel 6 Area = 1.2 Acres Owner: Koch Refining Current use: Storage related support Back to Map Parcel 7 Area = 16.6 Acres Owner: Conoco Inc Current use: Vacant Parcel 8 Area = 3.4 Acres Owner: Conoco Inc. Current use: Ground fuel storage tanks 7 8 Back to Map Area = 14.6 Acres Owner: Petroleum Co of Texas. Etal. Current use: Ground Fuel Storage tanks Parcel 9 S.H. 26 Back to Map Comments/Questions Should the city increase minimum limit of $10,000,000 on liability insurance? - Coverage level comparable with other local cities. Grapevine -$10,000,000 Ft. Worth -$10,000,000 Grapevine -$10,000,000 Colleyville -$10,000,000 Trophy Club -$10,000,000 Keller -$10,000,000 Mansfield -$10,000,000 - Staff will consult with insurance industry expert. Should drill site buffers areas be increased to 1,000’ from residential or commercial building (currently 600’) and 1,500’ from school, church, hospital and day care (currently 1,000). - The ordinance can be amended but is subject to a legal challenge if it prohibits drilling entirely in the city. Oil & Gas Ordinance Options Analysis of potential areas based on the Current Ordinance 600’ from residential and commercial structures 1,000’ from public building sites (including schools, day cares, institutions) Analysis of potential areas based on Option 1: 1,000’ from residential and commercial structures 1,000’ from public building sites (including schools, day cares, institutions) Analysis of potential areas based on Option 2: 1,000’ from residential and commercial structures 1,500’ from public building sites (including schools, day cares, institutions) Current Ordinance Current Ordinance Current Ordinance Option 2 Option 2 Option 2 Comments/Questions Should the screening requirements for the production site be amended? (Permanent production site – 8’ screening made of brick, concrete, earthen berm or a combination of all three). - determined during the SUP requirement. Noise levels can not exceed 70 decibels at a point 300’ from a well site. - Recommendation is to regulate noise based on the surrounding ambient noise levels. Comments/Questions Should the requirements for surface pits be reevaluated? - Not currently allowed. Some localities reconsidering this rule to allow a fresh water frac ponds if the pond is converted into an amenity after the drilling process is completed. - Add a requirement that a closed loop mud system be used to extract and hold salt water should be incorporated into the ordinance. Comments/Questions Evaluate of other current requirements: Oil and gas production lines can not exceed 100 psi and be buried 6’ depth. No open flow testing is allowed. All well lines must be equipped with high/low pressure shut off valves. Each producing well must be equipped with a down hole shut-off valve storm choke. - The city’s gas and oil consultant is reviewing the requirements to determine if they need to be revised to meet current safety standards. Continue to require access to wells and drill sites must be from state or federal highways. - This restriction may give rise to a taking claim QUESTIONS Gas & Oil Well Drilling CP 07-005 (Discussion Only) Ordinance 480-RRR (1st Reading) Ordinance 880-A (1st Reading) QUESTIONS Gas & Oil Well Drilling CP 07-005 (Discussion Only) Ordinance 480-RRR (1st Reading) Ordinance 880-A (1st Reading) QUESTIONS