Daily Times

Texas regulators are relaxing rules about where companies can store oil underground, raising concern among environmentalists about potential groundwater contamination and other dangers.

The oil isn’t going back to precisely where it came from. Instead, producers are exploring options to store it in underground geological formations that can hold oil and liquefied gas.

Earlier this month, a local oil and gas regulator temporarily gave the industry permission to store oil in unconventional underground formations, according to the Observer.

The move did not allow for a comment period or a public hearing, shocking local environmental groups.

Making matters worse, the regulator had to roll back state regulations that were in place to ensure groundwater was not being contaminated.

“Allowing storage in these other formations obviously raises a lot of concerns for both environmental health and the health of our aquifers,” Emma Pabst, from the think tank Environment Texas, told the Observer.

The shift aimed to help oil producers whose wells are spewing far more crude than the world can use after the coronavirus pandemic gutted global demand for jet fuel and gasoline. Producers are running out of spaces to store the oil, leading some to pay traders to take oil off their hands as prices cratered more than 60% and tanks filled up.

But environmental groups warn that the surprise rule change, which was approved by regulators before the public had a chance to review it, could lead to serious environmental consequences.

Commissioner Ryan Sitton said he had received a copy of the proposal the day before the meeting. Nevertheless, he supported the proposal, which passed 3-0.

“I want to make sure we’re being cautious. It sounds like you are,” Sitton said, addressing the other commissioners. “And it’s great that we’re moving quickly and allowing some additional storage quickly, but I don’t want to hear a story in three months of how we put oil in some sort of cave somewhere and we ended up having groundwater pollution.”

Under the new rule, which was suggested by a new task force of industry groups, companies that apply to do underground storage need to show that the formation is confined to prevent the waste or uncontrolled escape of crude oil, Christian said. The exemption will last for a year, and oil will have to be removed from the wells within five years.

“It’s somewhat unprecedented, but I think it is exciting that we’re affording as much opportunity as possible in this emergency situation,” Christian said.