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TITLE 16ECONOMIC REGULATION
PART 1RAILROAD COMMISSION OF TEXAS
CHAPTER 5CARBON DIOXIDE (CO2)
SUBCHAPTER BGEOLOGIC STORAGE AND ASSOCIATED INJECTION OF ANTHROPOGENIC CARBON DIOXIDE (CO2)
RULE §5.202Permit Required, and Draft Permit and Fact Sheet

(a) Permit required.

  (1) A person shall not begin drilling or operating an anthropogenic CO2 injection well for geologic storage regulated under this subchapter or constructing or operating a geologic storage facility regulated under this subchapter without first obtaining the necessary permits from the Commission. Following receipt of a geologic storage facility permit issued under this subchapter, the storage operator shall obtain a permit to drill, deepen, or convert a well for storage purposes in accordance with §3.5 of this title (relating to Application to Drill, Deepen, Reenter, or Plug Back).

  (2) A person may not begin injection until:

    (A) construction of the well is complete;

    (B) the operator has submitted to the director notice of completion of construction;

    (C) the Commission has inspected or otherwise reviewed the injection well and finds it is in compliance with the conditions of the permit; and

    (D) the director has issued a permit to operate the injection well.

(b) Permit amendment.

  (1) An operator must file an application to amend an existing geologic storage facility permit with the director:

    (A) prior to expanding the areal extent of the storage reservoir;

    (B) prior to increasing the permitted injection pressure or injection rate;

    (C) prior to adding injection wells; or

    (D) at any time that conditions at the geologic storage facility materially deviate from the conditions specified in the permit or permit application.

  (2) Compliance with plan amendments required by this subchapter does not necessarily constitute a material deviation in conditions requiring an amendment of the permit.

(c) Permit transfer. An operator may transfer its geologic storage facility permit to another operator if the requirements of this subsection are met. A new operator shall not assume operation of the geologic storage facility without a valid permit.

  (1) Notice. An applicant must submit written notice of an intended permit transfer to the director at least 45 days prior to the date the transfer of operations is proposed to take place, unless such action could trigger U. S. Securities and Exchange Commission fiduciary and insider trading restrictions and/or rules.

    (A) The applicant's notice to the director must contain:

      (i) the name and address of the person to whom the geologic storage facility will be sold, assigned, transferred, leased, conveyed, exchanged, or otherwise disposed;

      (ii) the name and location of the geologic storage facility and a legal description of the land upon which the storage facility is situated;

      (iii) the date that the sale, assignment, transfer, lease conveyance, exchange, or other disposition is proposed to become final; and

      (iv) the date that the transferring operator will relinquish possession as a result of the sale, assignment, transfer, lease conveyance, exchange, or other disposition.

    (B) The person acquiring a geologic storage facility, whether by purchase, transfer, assignment, lease, conveyance, exchange, or other disposition, must notify the director in writing of the acquisition as soon as it is reasonably possible but not later than five business days after the date that the acquisition of the geologic storage facility becomes final. The director shall not approve the transfer of a geologic storage facility permit until the new operator provides all of the following:

      (i) the name and address of the operator from which the geologic storage facility was acquired;

      (ii) the name and location of the geologic storage facility and a description of the land upon which the geologic storage facility is situated;

      (iii) the date that the acquisition became or will become final;

      (iv) the date that possession was or will be acquired; and

      (v) the financial assurance required by this subchapter.

  (2) Evidence of financial responsibility. The operator acquiring the permit must provide the director with evidence of financial responsibility satisfactory to the director in accordance with §5.205 of this title (relating to Fees, Financial Responsibility, and Financial Assurance).

  (3) Transfer of responsibility. An operator remains responsible for the geologic storage facility until the director approves in writing the sale, assignment, transfer, lease, conveyance, exchange, or other disposition and the person acquiring the storage facility complies with all applicable requirements.

(d) Modification, revocation and reissuance, or termination of a geologic storage facility permit.

  (1) Permit review. Permits are subject to review by the Commission. Any interested person may request that the Commission review a permit issued under this subchapter for one of the reasons set forth in paragraph (2) of this subsection. All requests must be in writing and must contain facts or reasons supporting the request. If the Commission determines that the request may have merit or at the Commission's initiative for one or more of the reasons set forth in paragraph (2) of this subsection, the Commission may review the permit.

  (2) Action by the Commission. The director may modify, revoke and reissue, or terminate a geologic storage facility permit after notice and opportunity for hearing under any of the following circumstances.

    (A) Causes for modification or for revocation and reissuance. The following may be causes for revocation and reissuance as well as modification:

      (i) Alterations. There are material and substantial alterations or additions to the permitted facility or activity which occurred after permit issuance that justify the inclusion of permit conditions that are different from or absent in the existing permit.

      (ii) New information. The director has received new material information that was not available at the time of permit issuance and would have justified the inclusion of different permit conditions at the time of issuance. This may include any increase greater than the permitted CO2 storage volume, and/or changes in the chemical composition of the CO2 stream that in the judgment of the director, would interfere with the operation of the facility or its ability to meet the permit conditions.

      (iii) New regulations. The standards or regulations on which the permit was based have been materially changed by promulgation of new or amended standards or regulations or by judicial decision after the permit was issued.

      (iv) Compliance schedules. The director determines good cause exists for modification of a compliance schedule, such as an act of God, strike, flood, or materials shortage, or other events over which the permittee has little or no control and for which there is no reasonably available remedy.

      (v) Basis for permit modification. The director shall modify the permit whenever the director determines that permit changes are necessary based on:

        (I) a re-evaluation under §5.203(d) of this title (relating to Application Requirements);

        (II) any amendments to the testing and monitoring plan under §5.203(j) of this subchapter;

        (III) any amendments to the injection well plugging plan under §5.203(k) of this title;

        (IV) any amendments to the post-injection site care and site closure plan under §5.203(m) of this title;

        (V) any amendments to the emergency and remedial response plan under §5.203(l) of this title;

        (VI) a review of monitoring and/or testing results conducted in accordance with permit requirements;

        (VII) cause exists for termination under subparagraph (B) of this paragraph, and the director determines that modification or revocation and reissuance is appropriate;

        (VIII) the director has received notification of a proposed transfer of the permit; or

        (IX) a determination that the fluid being injected is a hazardous waste as defined in 40 CFR §261.3 either because the definition has been revised, or because a previous determination has been changed.

      (vi) If the director tentatively decides to modify or revoke and reissue a permit, the director shall prepare a draft permit incorporating the proposed changes. The director may request additional information and, in the case of a modified permit, may require the submission of an updated application. In the case of revoked and reissued permits, the director shall require the submission of a new application.

Cont'd...

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