SoCal Gas Wants You to Know...
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February 3, 2017
Eugene "Mitch" Mitchell
State Governmental Affairs
925 L Street, Suite 650
Sacramento, CA 95814
The Honorable Robert Hertzberg, Chair
Senate Committee on Natural Resources & Water
State Capitol, Room 5046
Sacramento, CA 94249-0001
RE: SB 57 (Stern) - OPPOSE
Dear Chairman Hertzberg:
Southern California Gas Company (SoCalGas) must respectfully oppose SB 57 (Stern), which would extend the moratorium on natural gas injections at the Aliso Canyon storage facility until the Root Cause Analysis (RCA) of the leak that started in October 2015 has been completed. It would also require the California Public Utilities Commission (CPUC) to complete its analysis regarding the need for the Aliso Canyon storage facility by the end of this year.
While SoCalGas appreciates and shares Senator Stern’s concern for the community surrounding the facility, we believe SB 57 to be unnecessary because the results of the RCA are independent from the safety of the facility and its fitness for service as a result of the testing and enhancements that have already been completed at Aliso Canyon and verified by the Division of Oil, Gas, and Geothermal Resources (DOGGR):
Natural gas leaking into the atmosphere at SS-25 was a result of the failure of the outer well casing, as determined in a Federal Joint Interagency Task Force report published in October 2016.
SoCalGas has completed a comprehensive suite of tests of the outer casing and tests of the tubing for each approved well, in accordance with the Comprehensive Safety Review required under SB 380 (Pavley).
This testing validates that the outer casing and tubing of the approved wells will maintain their integrity at pressures higher than the maximum allowable operating pressure of the field.
Moving forward, Aliso Canyon will be operated at a much lower pressure than before the leak.
SoCalGas has reconfigured all approved wells with brand-new steel tubing and packers.
Natural gas will now only flow through the new inner steel tubing and the outer casing will not be used.
The outer casing now serves only as a secondary safety barrier.
Additionally, SoCalGas has completed safety measures and integrity-management activities that meet or exceed current legal and regulatory requirements:
We have implemented enhanced monitoring systems at the facility, including monitors that continuously track the pressure at each well and immediately alert onsite personnel if there is a change in pressure—24 hours a day, 7 days a week.
There are now daily inspections of every well using highly sensitive infrared cameras that can detect emissions smaller than those that can be detected using human senses.
Technicians also conduct surface inspections of each well four times per day.
In sum, SoCalGas believes SB 57 does not enhance safety at Aliso Canyon. The Aliso Canyon storage facility is safe and SoCalGas has made extensive infrastructure enhancements that meet or exceed the new laws and regulations.
Importantly, we must make you aware of the timing impacts of SB 57 on the region’s energy reliability. The CPUC has determined the existing production capacity at Aliso Canyon is insufficient to meet estimated demand in the coming season. In a report published January 17, the CPUC further determined that additional natural gas supplies at Aliso Canyon are needed to address safety and reliability concerns and "provide flexibility to respond to gas market conditions to support just and reasonable rates." The report specifically states that 29.7 billion cubic feet (Bcf) is necessary and that SoCalGas needs to provide .839 Bcf per day (Bcfd) of production to meet winter demand and .906 Bcfd for summer demand.1
1 "Aliso Canyon Working Gas Inventory, Production Capacity, Injection Capacity, and Well Availability for Reliability". California Public Utilities Commission. January 17, 2017. (3-4).
Based on our operational capabilities and experience, it will take approximately two months to reach the inventory necessary to meet summer demand. Therefore, SoCalGas believes it is crucial to begin replenishing the supply of natural gas in the field as soon as feasible to provide for energy reliability throughout the region. As a prudent operator, our obligation is to provide safe and reliable service to our nearly 22 million customers across our service territory at reasonable rates. Aliso Canyon is a critical component of our ability to do so.
We look forward to working with Senator Stern to address the concerns of his constituents and our customers to assure everyone that the Aliso Canyon facility is safe and ready to resume injection operations. We thank the Senator for his engagement and look forward to a productive dialogue.
For the reasons stated above, SoCalGas must oppose SB 57, and respectfully requests your "NO" vote.
c: The Honorable Henry Stern Honorable Members of Senate Committee on Natural Resources
Mr. Bill Craven, Chief Committee Consultant
Ms. Katharine Moore, Committee Consultant
Ms. Nancy McFadden, Executive Secretary, Office of the Governor Ms. Camille Wagner, Legislative Affairs Secretary, Office of the Governor
Mr. Michael Martinez, Deputy Legislative Secretary, Office of the Governor
Mr. Saul Gomez, Deputy Cabinet Secretary, Office of the Governor