Summary of 2024 Rulemakings In addition to curating engaging content and events for our members and full-time legislative representation, it’s also been a very busy year in the regulatory arena. While this isn’t a comprehensive list of all the rulemakings we’ve engaged in this year, we wanted to highlight a few of the Utah-specific rules that we have been heavily engaged in, ensuring that the state remains balanced and business friendly. UPA also engages in federal rules (most often with BLM and EPA) and partners with other regional and national trades. We hope this gives you (and prospective members!) a more holistic understanding of who we are, what we do and how we are laser-focused on policy and regulation to keep Utah, well, Utah! Duchesne County • Ordinance 24-409 Oil and Gas Zoning Amendments: UPA has been discussing the need for operators to support the county on road repair and maintenance resulting from industry wear and tear for at least two years, and this spring, we entered into more focused negotiations with the county on an ordinance that would create a Conditional Use Permit. Notice provisions to impacted owners and other conditions (many of which were already included in the county Master Transportation Plan) for oil and gas drilling and production sites will be required prior to new sites being permitted by the county. The county also intends to establish a Transportation Mitigation Fee, and UPA has been very actively engaged in working with the county and their consultants to advocate that the fee is used only for industry roads and at a rate that supports industry-related repair and maintenance needs. As of the time of writing, negotiations on the Transportation Mitigation Fee are ongoing. • Ordinance 24-407 Flare Gas Power Generation: Duchesne County passed this ordinance setting out site location and layout requirements as well as ambient noise and vibration limits and mitigation requirements for flare gas power generation facilities. UPA engaged closely with producers and the county to address concerns of neighbors near these facilities, while ensuring restrictions were achievable for industry. • Ordinance 24-414 Roosevelt Airport Overlay Zone: Duchesne County passed this ordinance (and we expect the Roosevelt and Vernal airports to take up this issue soon) in order to comply with legislation passed in the 2024 session affecting all airports in the state. Six airport protection zones were enacted, some of which directly conflicted with existing oil and gas facilities and/or interests, and a list of restricted activities was compiled for each overlay zone. UPA supported producers working with the county to ensure that as long as the activities either do not exceeded the FAA Notice Criteria or the FAA has issued a Determination of No Hazard to Air Navigation, oil and gas activities could continue in these overlay areas. Utah Division of Oil Gas and Mining • Bonding Rule: Currently being drafted by the Division and has not yet started the formal rulemaking process (as of the time of writing). The rule will make multiple changes to definitions, how a change of operator is addressed, bond releases, and the overall bonding structure and fees. The rule sets out a new framework for calculating an “at-risk well ratio” based on an operator’s total amount of production, the number of active wells in the state and the number of “at-risk wells” and then applies a tiered bonding schedule based on the number of state wells and number and depth of “at-risk” wells. If it sounds complicated, well, it is! But the hope by the division and the industry is that it more accurately evaluates an individual operator’s risk and, therefore, the amount of financial assurance they should provide to the state while also allowing for flexibility by “bucketing” wells in groups of 10 to limit the amount of bonding adjustments industry and the division need to administer. • Water Recycling: R649-9 is anticipated to be proposed to the board for the start of formal rulemaking in December. While oil and gas wastes are now the jurisdiction of WMRC (see more below), water recycling facilities are regulated by DOGM following the passage of HB 295 (Lund, 2024). This bill was UPA’s priority during the 2024 session, and we remained closely engaged and supportive of these rules, which define produced water and related facilities and include extensive criteria for how these facilities must be sited, designed, constructed and operated. • DOGM Class VI Carbon Sequestration Rule: The division is currently drafting this rule and has undertaken a robust stakeholder engagement process. Following legislation directing the division to seek primacy and setting out basic scaffolding in Utah’s 2022 session, DOGM is preparing a rule and primacy application to EPA for geologic carbon storage. UPA is engaging in this rulemaking to provide a third-party legal review focused on potential implications on minerals and oil and gas operations. • The Board of Oil, Gas and Mining (BOGM) has started drafting rules regarding how notices of opportunity to participate (related to forced pooling) shall be handled. This rule is still in the drafting phase, and UPA has provided feedback focused on ensuring landowners receive appropriate information but that private negotiation and contract terms between the operator and the mineral owner remain private and are not regulated by the Board. Utah Department of Air Quality • Low Vapor Pressure Gasoline: Rule apparently not going forward. 12 UPDATE
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