oErr\ Proposed Issuance of Underground Injection Control (UIC) Permit: Fact Sheet - June 27, 2017 This cover sheet provides a brief overview ofproposed Permit AK1I001-B for the Operation of Class I Non-Hazardous Industrial Waste Injection Wells at the Badami Area Oil and Gas Unit on the North Slope of Alaska. For more information, please see the attached document, which contains comprehensive, technical details about the proposed permit. For information on how to submit public comment or a request for a public hearing, see the last page of this Fact Sheet. What is proposed The permit allows for the construction of wells and injection of non-hazardous waste in the permit? over 4,000 feet below ground surface. This type of well is called a Class I injection well. Will a new well be This is a permit reissuance. This operator has injected through one well at this site under drilled? an EPA permit since 1997. The operator has the option of drilling a second well under this permit. Why is the well By injecting waste through this well, the operator will not need to release waste onto needed? land or into surface waters. What will be injected into the well? The waste injected into this well will include, but not be limited to: treated domestic wastewater, drilling muds and cuttings, well workover fluids, melt and storm water, a small amount of facility water and production water, and other exempt and non-exempt non-hazardous fluids. How can I EPA accepts public comments and requests for public hearings for proposed draft comment and/or permit actions during the public comment period, which beings on June 30, 2017, and request a hearing? ends on July 31, 2017. If you would like to make a comment or request a hearing, review the "Public Comment" section at the end of this Fact Sheet or go to www. epa. gov/region 10. Where can I find If you are seeking more information related to this Fact Sheet, please go to more information? www.epa.gov/regionlO or contact: Ryan Gross, P.E., UIC Program Specialist: gross.rvan@epa.gov or 206-553-6293 Page 1 of 7 ------- BAD AMI UNIT CLASS I UIC WELL FACT SHEET Proposed Issuance of Underground Injection Control (UIC) Area Permit AK1I001-B For the Continued Operation of a Class I Non-Hazardous Industrial Waste Injection Well At the Badami Area Oil and Gas Unit on the North Slope of Alaska Background Savant Alaska, LLC (SAVANT), submitted an Underground Injection Control (UIC) permit application to the US Environmental Protection Agency (EPA) on February 22, 2017, for the operation of up to two Class I non-hazardous industrial waste injection (Class I UIC) wells at the Badami Unit. The Badami Unit is located onshore about 30 miles east of Prudhoe Bay. One well, the Badami Class I UIC Well (Bl-01), was completed in 1997 under EPA permit AK1I001-A about one mile south of the Badami Development Facility. BP Exploration (Alaska), Inc. (BPXA) submitted an initial application to EPA for the construction and operation of two Class I UIC wells was in April 1996, for which EPA issued a Class I permit to inject (AK1I001-A) on August 22, 1997. The term of the initial permit was ten years, expiring on August 22, 2007. BPXA submitted an application to EPA for the reissuance of the permit on January 31, 2007, for which EPA reissued a permit on August 23, 2007. The currently active permit will expire August 22, 2017. SAVANT succeeded BPXA as Unit Operator of the Badami Unit on October 14, 2011. EPA has prepared a draft permit to be reissued to SAVANT for continued operation of an existing Class I UIC well with the option to drill and operate a second well. This fact sheet presents EPA's principal considerations in preparing the draft permit. Regulatory Framework The UIC program is authorized by Part C of the Safe Drinking Water Act (SDWA) for the principal purpose of protecting Underground Sources of Drinking Water (USDWs) from pollution by injection through wells. The UIC regulations broadly define USDWs (see 40 CFR § 144.3) as any aquifer which supplies a public water system or which, by virtue of its potential productivity and natural water quality, could supply a public water system with water containing less than 10,000 milligrams per liter total dissolved solids. If injection does not occur above, into, or through a USDW, then less stringent permit conditions may be imposed than would otherwise be required (see 40 CFR § 144.16). Primary responsibility for the UIC program in Alaska is divided between EPA and the Alaska Oil and Gas Conservation Commission (AOGCC). The AOGCC regulates Class II UIC wells, which are defined as wells used (1) to dispose of waste fluids brought to the surface from oil and gas production operations, (2) for enhanced recovery of oil and gas, or (3) for storage of hydrocarbons which are liquid at standard temperature and pressure (see 40 CFR § 144.6). EPA regulates all other classes of UIC wells in Alaska, including Class I. The UIC regulations allow Class II fluids, those in connection with the production of oil and natural gas, to be disposed of into Class I or II UIC wells. Class I fluids, such as other non- hazardous waste, may not be injected into Class II wells. Regulations concerning injection well requirements can be found in 40 CFR §§ 144 and 146 (criteria and standards applicable to Class I wells are found at 40 CFR § 146 Subpart B). As described below, aquifers beneath the Badami Unit area are too naturally saline to be considered as USDWs. Under these circumstances, the EPA Regional Administrator or delegated authority (EPA Director) may authorize injection with less stringent requirements than would otherwise be required (see 40 CFR § 144.16). EPA intends to grant three waivers requested by SAVANT, which are described under the Subsurface Aquifers/No USDW Ruling/Waivers Granted section of this fact sheet. EPA Permit and General Project Overview Reissuance of this ten-year term permit by EPA would allow SAVANT to continue to inject exempted exploration and production fluids and other non-hazardous waste fluids through the injection well. Page 2 of 7 ------- SAVANT expects to inject fluids including, but not limited to: drilling mud and slurry, produced water, well workover and treatment fluids, accumulated melt and storm water, and treated sanitary waste. At shutdown, the well may also be used for clean out and abandonment activities. The permit would allow SAVANT to inject all non-hazardous and RCRA-exempted waste fluids generated at Badami. This draft permit allows SAVANT to inject fluids into the naturally saline Sagavanirktok and Ugnu formations in the Badami Unit area. The Sagavanirktok formation overlies the Ugnu formation. Currently, SAVANT injects through only one active Class IUIC well, Bl-01, into the Ugnu formation at a depth of 7,216-7,243 feet true vertical distance (TVD). SAVANT is also authorized to inject into the Sagavanirktok formation through this well if needed. In accordance with UIC regulations, EPA has determined that the proposed injection intervals and overlying aquifers are too naturally saline to be considered as USDWs. The Badami Unit includes up to 12 development wells connected to the Badami Production Facility. After separation, the oil produced at the Badami Unit is transported through the Trans-Alaska pipeline. The associated produced water and gas are reinjected into the reservoir formation. The oilfield currently produces approximately 1,000 barrels of oil per day with about a 1% water cut. The production comes from the Badami Oil Pool reservoir at approximately 9,000-12,000 feet TVD. Fluid is not injected into the injection well for the purpose of enhance oil recovery. SAVANT has not applied for a hazardous waste injection well permit at the Badami Unit. Therefore, any listed hazardous wastes would need to be collected, stored, and transported to a RCRA-approved hazardous waste treatment or disposal facility. Wastes which are not listed hazardous wastes but are hazardous because of a characteristic (e.g., ignitability, corrosivity, toxicity, etc.) may be injected into a Class I UIC well after being treated to remove that characteristic. Naturally occurring radioactive material (NORM) from sludge or pipe scale (a mineral precipitate formed during production) is the only radioactive substance which may be injected under this permit. NORM can be injected into either Class II or Class I non-hazardous waste injection wells. Regional Geology The geologic setting at the Badami Unit is favorable for waste disposal via injection well. The stratigraphic sequence and lithology in this area correlate highly with the formations found at Prudhoe Bay, where hundreds of Class I and Class II injection wells have operated for over thirty years. The sedimentary strata at Badami include, in ascending order, the Canning, West Sak, Ugnu, and Sagavanirktok formations. This information is based on logs from the nearby Badami production wells. The Canning, West Sak, and Ugnu formations are the final regressive marine sequence in the Middle Brookian section of (Upper Eocene to Oligocene) Tertiary time. The Sagavanirktok formation is comprised of at least two cycles of marine transgression-regression in the Upper Brookian section of (Upper Eocene to Oligocene) Tertiary time. The Canning formation, the Lower Confining Zone, is the lowermost strata in the sequence. As such, this zone may not be fractured under UIC regulations and the conditions of this permit. It is composed of shale and shaley siltstone ranging from Upper Cretaceous to Lower Tertiary (Paleocene to Eocene) in age. This unit, 2,500-3,000 feet thick, was originally deposited as muddy sediments on a deep marine slope. The West Sak formation, the lower arresting zone, overlays the Canning formation. It is composed of shale and siltstone with interbeds of sandstone having poor reservoir quality. This formation is approximately 1,000 feet thick and is from the Middle Brookian (Upper Eocene to Oligocene) section of Tertiary time. The Ugnu formation, the lower Injection Zone, overlays the West Sak formation. It is composed of shallow shelf and coastal plain, fluvial fine to medium grained, sandstone with interbeds of mudstone and siltstone and rare coal beds. This layer, 200-250 feet thick, marks the end of the Middle Brookian Page 3 of 7 ------- regressive episode of Tertiary time. The sands of this formation are loosely consolidated with high porosity and permeability. The Sagavanirktok formation overlays the Ugnu formation. It is composed of several units, listed here in ascending order: • The basal Sagavanirktok unit is a shale that acts as neither the Upper or Lower Confining Zone, but rather an intermediate confining zone between the two approved injection zones. This shale and siltstone layer, 1,750 feet thick, was formed by a depositional transgression that created a subsiding muddy shelf. • The Sagavanirktok initial regressive sandstone unit is the upper Injection Zone. This layer, 375 feet thick, is of fluvial to shallow shelf origin and consists of fine to coarse grained sands with some gravel. The sands are mainly unconsolidated and maintain high porosity and permeability. • The Sagavanirktok transgressive sand and mud unit is the upper arresting zone. This layer, 450- 700 feet thick, is composed of alternating mud and sand beds indicative of deltaic to near shore marine deposition in a slowly transgressive sea. • The Sagavanirktok upper shale unit is the Upper Confining Zone. As such, this zone may not be fractured under UIC regulations and the conditions of this permit. This unit, 300-500 feet thick, is composed of shales dominated by mud and muddy silt deposited on a marine shelf during the maximum transgression of the sea. • The Upper Confining Zone is overlain by 3000-4000 feet of coarse sand and gravel developed during the final (Oligocene time) regressive stage of the Sagavanirktok formation. The upper coarse interval in the Badami area contains permafrost. Permafrost is about 2000 feet thick onshore at the development facility. The permafrost in this area forms an additional barrier to any upward fluid migration to the surface. Zone Unit/Formation Depth (feet TVD) Lower Confining Zone Canning 8,420-10,500 Lower Injection Zone Ugnu 7,020-7,270 Upper Injection Zone Sagavanirktok 4,853-5,165 Upper Confining Zone Sagavanirktok 3,715-4,160 The Badami Unit Injection and Confining Zones are within formations highly correlative to those into which waste has been injected at the Prudhoe Bay and Duck Island Units. In all three areas, the Lower Confining Zone is the Seabee Shale (equivalent to the Canning formation and the Colville Mudstone). The Injection Zones in all three areas contain the Ugnu formation and the basal sands of the Sagavanirktok formation. The Upper Confining Zone and arresting zone are mud dominated units of the Sagavanirktok formation that lie above the basal unit of the Sagavanirktok sands and below the massive gravels and sands which extend upward into the permafrost. The well is currently completed in the lower Injection Zone of the Ugnu formation in the perforated interval 8390 - 8420 feet measured depth (MD) (7216-7243 feet TVD). Injection Zone Property Ugnu Injection Interval Sagavanirktok Injection Interval Gross sand thickness (feet) 200-250 300-400 Net/gross ratio (%) 40-60 70-90 Porosity (%) 27 31 Permeability (millidarcies) 150-750 500-2500 Seismic data show that there are no significant faults apparent within the Badami Development area. No natural faulting is significant enough to provide migration paths that would potentially cause a breach of the confining shales. Page 4 of 7 ------- Injection Well EPA issued the first 10-year Class I UIC permit the Badami Unit to BPXA on August 22, 1997. The Badami Class I UIC well (Bl-01) was placed online for injection on November 17, 1997. There is an on- site grind and inject facility to handle solids in the waste stream prior to injection. Based on performance to date, the well is in compliance and has remained in compliance with all UIC permit requirements since the permit was initially issued in 1997. This Class I UIC permit for Badami Unit allows SAVANT to operate up to two injection wells, each of which are permitted to inject into two approved intervals (the Ugnu and Sagavanirktok formations). EPA has verified the mechanical integrity of the Bl-01 well by regularly observing internal and external mechanical integrity tests. To test internal mechanical integrity, the inner annulus between casing and the tubing is pressurized up to 3,500 pounds per square inch (psi) for at least 30 minutes. To demonstrate the integrity of the annular void, the pressure may not decrease by more than 10% over the 30-minute test and any loss in pressure must show a stabilizing tendency. EPA observes pressure tests to verify internal mechanical integrity at least once during every calendar year during the term of the permit. Every test witnessed or conducted by EPA confirmed the internal mechanical integrity of the well. The most recent test was conducted on March 17, 2016, and passed. EPA has verified the external mechanical integrity of the Bl-01 well by observing a variety of tests, including tracer log tests, water flow log tests, and temperature log tests. These tests are conducted to verify there is no channeling or fluid flow along the casing outside of the injection interval. EPA witnessed or conducted a test of external mechanical integrity at least every two years during the term of the permit. Every test witnessed or conducted by EPA confirmed the external mechanical integrity of the well. The operator has installed and maintains alarms to detect excess injection pressures and significant changes in annular fluid pressure. The operator has also installed and maintains an emergency shutdown system to respond to losses of internal mechanical integrity as evidenced by deviations in the annular fluid pressures. These alarms and emergency shutdown systems are in compliance with both permit and safety requirements (per Part II Section D.3 of permit AK1I001-A). Waste management practices at this facility must be in compliance with overall waste management practices in the North Slope and in compliance with the Class I permit. Since operation began in 1997 through the end of 2016, the operator has inj ected 1.165 MMB of fluid into the Bl-01 well. The injected waste stream is comprised of about 50% domestic wastewater, 25% RCRA-exempt exploration and production wastes, 20% melt and storm water, and a small amount of facility water and production water. Over the term of the last permit, an average of 90 barrels/day of waste has been injected into the well, with a maximum rate of 4 barrels /minute. Waste is injected into the well at an average pressure of 1,473 psi, with a maximum pressure of 2,198 psi. Areal pressure data measured across the Prudhoe Bay area indicates that no natural aquifer movement exists. The only lateral movement of fluids within the aquifer that occurs is caused by injection or production. The pressure gradient is estimated to be 0.451 psi/foot of depth from the surface to the Canning Shale. The temperature gradient below the permafrost is estimated to be 108 feet/degree Fahrenheit. The injection intervals have an estimated fracture gradient of 0.65 psi/foot of depth. Though the shale gradient has not been defined, it will be greater than that of the sand intervals as there is a stress contrast between the two strata. Subsurface Aquifers/No USDW Ruling/Waivers Granted On May 12, 1997, EPA determined there are no USDWs (No USDW Determination) under the Badami Page 5 of 7 ------- Unit because of the high natural salinity of the aquifers between the base of the permafrost (above the Upper Confining Zone) and the Canning shale (Lower Confining Zone). See letter to BPXA from EPA dated May 12, 1997 "EPA Determination Regarding USDW's in the Badami and Northstar Field Areas of the North Slope ". The legal description of the Badami Unit Area that applies to the No-USDW Ruling is the Badami Unit Area, which includes: T09N, R19E UM Sections 1, 2, 11, 12 ,13, 14; T09N, R20E UM Sections 1-24; T10N, R19E UM Sections 13-15,22-,27,34-36. Due to the absence of USDWs at the proposed location, EPA intends to continue to grant SAVANT three waivers of UIC regulatory requirements, as listed below: (1) Compatibility of Formation and Iniectate (40 CFR §§ 146.12 (e)(4) and (5) and 146.14 (a) (8)): Based upon the applicability of past injectability studies, injection practices at the North Slope of Alaska, and the performance of B1-01 since 1997, EPA intends to waive the requirement to sample and characterize formation fluids and the rock matrix in order to determine whether or not they are compatible with the proposed injectate. (2) Injection Zone Fracturing (40 CFR § 146.13 (a)(1)): Class I injection wells are prohibited from injecting at pressures that would initiate new fractures or propagate existing fractures within the injection zone. EPA intends to waive this prohibition, and would instead allow hydraulic fracturing so long as new fractures are not initiated nor existing fractures propagated within the upper confining zone. The permitted injection zone includes both the lower injection interval in the Ugnu formation at 7,020-7,270 feet TVD and the upper injection interval in the Sagavanirktok formation at 4,853-5,165 feet TVD. (3) Ambient Monitoring Above the Confining Zone (40 CFR §§ 146.13 (b)(1) and (4) and 146.13 (d)): EPA intends to waive the requirement to monitor the strata overlying the Upper Confining Zone for fluid movement since the aquifers at the Badami Unit are too naturally saline to qualify as USDWs. Summary of Proposed Action and Permit Conditions EPA has primary enforcement authority in Alaska for Section 1422 of the UIC program (authorized by Part C of the Safe Drinking Water Act), which includes the regulation of Class I injection wells. Class I non-hazardous industrial wells are used to inject waste fluids that are exempt from hazardous characterization or non-exempt and non-hazardous beneath any existing USDW. EPA proposes to reissue a permit to SAVANT for up to two Class I non-hazardous waste injection wells at Badami. SAVANT currently operates one non-hazardous Class I injection well at Badami, Bl-01, and is authorized to drill a second injection well at a later date. The proposed, reissued permit would contain limits on the construction specifications of Class I wells, type of injected fluids, and injection pressure and rate. It would also require mechanical integrity testing and reporting at regular intervals. These terms and the regulations that govern underground injection are implemented to ensure proper construction and use of injection wells. EPA has determined that the aquifers beneath the Badami Unit meet the criteria for a No USDW Ruling area and has waived some of the regulatory requirements for Class I wells. Namely, EPA has previously waived and intends to continue waiving the requirement to determine compatibility of injected fluids and the rock matrix, the requirement to monitor the aquifers above the injection zone, and the prohibition against fracturing the subsurface. The Director can waive certain requirements under 40 CFR § 144.16(a), and has chosen to do so in this case based on historical injection performance, the lithology of the injection and confining zones, and the ruling that no USDWs are located within a quarter mile of the injection wells. The draft permit contains general legal provisions common to EPA permits, specific technical requirements that apply to all Class I injection wells, and particular technical, monitoring and reporting requirements for the proposed injection operations at Badami. The conditions in draft permit AK1I001-B Page 6 of 7 ------- intend to allow injection by this method while protecting USDWs, human health, and the environment. Public Comment Persons wishing to comment or request a Public Hearing on this Class I Non-Hazardous Draft Permit may do so during the public comment period. The public comment period will begin on June 30, 2017, at 9:00 AM, and end on July 31, 2017 at 5:00 PM. A request for a Public Hearing must state the nature of the issues to be raised as well as the requester's name, address and telephone number. All comments and requests for Public Hearings must be in physical or electronic writing and should be submitted to the EPA as described in the Public Comments Section of the attached Public Notice. Please send your comments and requests to the below physical or email address by the close of the public comment period. Ryan Gross, P.E., UIC Program Specialist U.S. Environmental Protection Agency, Region 10 OCE-101, Ground Water Protection Unit 1200 Sixth Avenue Seattle, Washington 98101 Gross.Ryan@epa.gov After the Public Notice expires and all comments have been considered, the EPA's Regional Director for the Office of Compliance and Enforcement will make a final decision regarding permit issuance. If no substantive comments are received, the tentative conditions in the draft permit will become final, and the permit will become effective upon issuance. If substantive comments are received, the EPA will address the comments and issue the permit. The permit will become effective no less than 30 days after the issuance date, unless an appeal is submitted to the Environmental Appeals Board within 30 days pursuant to 40 CFR § 124.19. Page 7 of 7 ------- |