This comment letter response contains two parts:

(1) The original submittal from the commenter. (2) A data base printout of EPA’s response to each point raised by the commenter.

Notes about the response letters:

• The response letters were generated by a data base used to track the content of all public

comment submittals and ensure that the Agency responds to each. Each comment letter

was assigned a Letter ID that corresponds to the last four digits of the docket number of the

original comment (as posted on www.regulations.gov).

• Each response letter includes: comment text; an EPA

‐ assigned comment code; and an

individual response. These are described and explained below.

• The data base contains Comment text from the letters submitted by commenters.

Many hard copy letters were scanned into electronic format for inclusion in the data

base. As a result, there may be some typographical errors attributable to optical

character recognition issues. However, all original submittals were reviewed in the

process of drafting responses to ensure that the comment content was understood and

appropriately addressed.

• The content of each comment letter was divided into topic areas and assigned a unique

Comment ID. Additionally, one or more Comment Codes (i.e., unique topic area ID) was assigned to each discrete point raised by a commenter. This information was added to

the data base. To inform final rulemaking decisions, all comments and information

received on a given topic were reviewed by technical experts in each rule area (e.g., on

construction requirements).

• Following decisions on the final rule requirements, Individual responses were drafted

by topic area to ensure completeness and consistency of the responses with the final

rule and other responses to similar comments. Each discrete point made by a

commenter was given a unique response.

• Upon completion of comment responses, all information was entered into the data base.

Each letter response is a compilation of each comment and its individual response, compiled in the order of the original comment letter. As a result of this process, there is

repetition in the response text. The Agency believes this approach ensures completeness

and attention to each comment letter that was submitted.

• All comments in a topic area were reviewed, evaluated, and responded to concurrently.

Responses on each topic area are compiled and are also available in the rulemaking docket.3555 N.W. 58 th Street, Suite 400, Oklahoma City, OK 73112

Telephone 405-942-2334 Fax 405-942- 4636 Toll Free 1-800-838-6472 OKLAHOMA INDEPENDENT PETROLEUM ASSOCIATION

December 24, 2008

Water Docket Environmental Protection Agency

Mailcode: 2822T 1200 Pennsylvania Ave., NW. Washington, D.C. 20460

Re: Federal Requirements Under the Underg round Injection Control Program for Carbon Dioxide Geologic Sequestration Wells , Docket ID No. EPA-HQ-OW-2008-0390

The Oklahoma Independent Petroleum Association (OIPA) is submitting comments on the Environmental Protection Agency’s (EPA’s) proposed rule regul ating the underground injection and geologic sequestra tion of carbon dioxide (CO2) that was published in the Federal Register on July 25, 2008.

The OIPA represents approximately 2,000 large and small independent crude oil and natural gas producers in Oklahoma. We appreciate th e opportunity to provi de input into the rulemaking process, and we submit the follo wing comments and recommendations for your

consideration.

Carbon dioxide has been used by the oil and gas industry in enhanced oil recovery (EOR) projects in a safe and effectiv e manner for over 35 years whic h has contributed to increased American oil production. EPA should ensure it s proposed rule does not negatively impact or impede the use of CO2 in Class II EOR projects or the disposal of CO2 and other fluids that are generated in the production of oil and gas in to Class II wells that ar e currently regulated. Under Part II, item G of the proposed rule, EPA states that if finalized, the proposed requirements “...would not specifically (emphasis added) apply to Class II injection wells...” We think EPA needs to clearly state that these activities are exempt from EPA’s proposed rule so that our industry can continue to eff ectively produce American oil resources.

EPA has proposed to regulate CO2 as a wast e and has proposed regul ations that are as stringent as or more stringent than EPA’s re quirements for Class I hazardous waste wells. We think treating CO2 as a waste is the wrong approach as it will unnecessarily open up

unwarranted concerns, increased burdens and costs, and liability issues associated with the use of CO2 in EOR projects. In addition, it will prevent or discourage entities from proceeding with projects to store CO2 in undergr ound formations or convert depleted Class II EOR wells to Class VI CO2 storage wells. We en courage EPA to not consider CO2 as a waste product.

In Oklahoma, oil and gas reservoirs provide a gr eat capacity to store CO2. The State’s oil and gas agency has a long history of effectively re gulating Class II wells since the early 1980s. EPA should allow a process for states like Okla homa to easily obtain primacy for Class VI2 wells. In addition, states should have flexibil ity in determining which agency should regulate CO2 storage wells. For example, in Oklahoma, it would be more efficient and cost effective if the state oil and gas agency reta ined authority for al l Class II EOR project s converted to Class VI CO2 storage projects and CO2 storage projects using depleted oil and gas reservoirs since this agency has the most knowledge and expe rience with those underground formations.

Finally, we think EPA’s proposed grandfatheri ng requirements are too restrictive and will prevent or discourage entities from converting Class II EOR wells to Class VI wells. EPA has proposed to only allow the construction requiremen ts to be “grandfathered” based on the UIC program director’s discretion wh ile all other requirements woul d apply. There is no reason to limit the grandfathering of requirements for exis ting CO2 EOR wells that have proven to pose no endangerment to underground sources of drin king water. We think EPA should expand the scope of grandfathering requirements for thes e types of wells and limit additional Class VI requirements.

Again, we appreciate the opportuni ty to provide input on EPA’ s proposed CO2 rule. Thank you in advance for your consideration.

Sincerely,

Angie Burckhalter V.P., Regulatory AffairsLetter ID: 0239 Commenter: Angie Burckhalter Organization: Oklahoma Independe nt Petroleum Association

Letter ID: 0239 Comment ID: 23213 Letter Lines: 39 to 49

Comment Code: 2046 1.5.2.3 Continuing to classify CO2 in jection for EOR/EGR as Class II/ dividing line between Class II and Class VI (seeking comment)

Comment: Carbon dioxide has been used by the o il and gas industry in enhanced oil recovery (EOR) projects in a safe and effective manner for over 35 years which

has contributed to increased American oil production. EPA should ensure its proposed rule does not negatively impact or impede the use of CO2 in Class II EOR projects or the disposal of CO2 and ot her fluids that are generated in the production of oil and gas into Class II wells that are curre ntly regulated. Under Part II, item G of the proposed ru le, EPA states that if finalized, the proposed requirements "...would not specifica lly (emphasis added) apply to Class II injection wells..." We think EPA needs to clearly state that these activities are exempt from EPA’s proposed rule so that our industry can continue to effectively produce American oil resources.

Individual Response: EPA agrees that injection of CO2 for the primary purpose of enhancing oil and gas recovery should remain under the Cl ass II Program. However, the Agency disagrees that wells injecting CO2 for the primary purpose of long term storage sh ould be regulated under Class II requirements because Class II requirement s are not adequate to address the unique risks associated with long term storage of CO2 while ensuring the protection of USDWs from endangerment.

EPA recognizes that the oil and gas industry has decades of e xperience injecting CO2 for the purpose of ER, and that sites used for ER may be suitable for GS and may be among the first GS sites. Furthermore, EPA also re cognizes that a by-product of ER activities is that a certain percentage of the CO2 is trappe d in the receiving formation. Howe ver, the Agency believes that the nature and risks of CO2 inj ection for the primary purpose of long term storage poses different risks than injection for the primary purpose of ER, and therefore has de veloped new Class VI regulations to address these unique risks. For example, the volu me of CO2 anticipated to be injected for long term storage is significan tly greater than for EO R operations. Reservoir pressure conditions will also be different, with Class VI injection ope rations involving large volumes of CO2 and likely having higher pressures w ithin their storage formations than Class II EOR projects, which may lead to flui d movement that endangers a USDW.

Letter ID: 0239 Comment ID: 23214 Letter Lines: 51 to 59

Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment)

Comment Code: 1680 1.3.8 Don't overstate ris k, don't stigmatize CO2

1Comment: EPA has proposed to regulate CO2 as a wa ste and has proposed regulations that are as stringent as or more stringent than EPA’s requirements for Class I hazardous waste wells. We think treating CO 2 as a waste is the wrong approach as it will unnecessarily open up unwarranted c oncerns, increased burdens and costs, and liability issues associated with the use of CO2 in EOR projects. In addition, it will prevent or discourage en tities from proceedin g with projects to store CO2 in underground formations or convert depleted Cla ss II EOR wells to Class VI CO2 storage wells. We encourage EPA to not consider CO2 as a waste product.

Individual Response: First, EPA notes that the GS rule is not promulgated under either the

RCRA or CERCLA statutes, and the applicability of those stat utes will not be determined under the SDWA or the terms of the GS rule, but rather according to those statutes themselves and any implementing regulations that may apply. S econdly, EPA disagrees that the Class VI requirements themselves, or EPA’s consideration of the Class I requirements, necessarily have any implications for whether a particular mate rial is a RCRA “solid waste” or implicates CERCLA liability, as EPA understands the co mment to suggest. EPA received many comments regarding the applicability of the RCRA regulat ions and statute to CO2 streams that are geologically sequestered under the final Class VI UIC well requirements. As a result, EPA has decided to initiate a separate proposed rulemaki ng specifically to examine the issue of RCRA applicability to CO2 streams be ing geologically sequestered, in cluding the possible option of a conditional exemption from the RCRA requirement s for CO2 GS in Class VI wells. EPA will consider these comments as part of its devel opment of that proposal. The Agency will consider issues particular to RCRA in the context of th at separate rulemaking, and recommends that the commenter read that proposed rule when it is published. The Agency notes that commenters who wish to submit comments on the RCRA proposal will need to do so during the comment period

for that rule.

EPA adds that encouraging the use of GS is outsi de the scope of the GS rule. Rather, the purpose of the GS regulation is to ensu re that, where deployed, GS is c onducted in a manner that protects USDWs from endangerment.

Letter ID: 0239 Comment ID: 23215 Letter Lines: 61 to 70

Comment Code: 5600 2.11 Comments related to UIC Program primacy for Class VI wells

Comment: In Oklahoma, oil and gas reservoirs provi de a great capacity to store CO2. The State’s oil and gas agency has a long hi story of effectively regulating Class II wells since the early 1980s. EPA shoul d allow a process for states like Oklahoma to easily obtain primacy for Cla ss VI wells. In addition, states should have flexibility in determining which agen cy should regulate CO2 storage wells. For example, in Oklahoma, it would be more efficient and cost effective if the state oil and gas agency retained au thority for all Class II EOR projects converted to Class VI CO2 storage proj ects and CO2 storage projects using depleted oil and gas reservoirs since th is agency has the most knowledge and experience with those underground formations.

2Individual Response: EPA acknowledges the expertise of exis ting State, Tribal, and Territorial programs that implement the UIC requirements under Section 1422 of the SDWA (Class I, III, IV, and V wells) and state oil and gas agencies th at have been regulating Class II UIC wells for decades under section 1425 of SDWA. These ag encies already understa nd the technical and administrative issues involved in construction, operation, injection and permitting as well as, in the case of Class II operators issu es related to CO2 injection, s ubsurface operations, and pipeline transport. EPA believes that existing programs can adapt this expertise to the new requirements for Class VI wells and will be able to develop a primacy application for Class VI wells under

section 1422 of SDWA.

Many of the tools, resources, expertise, and infr astructure currently exist within States to effectively and efficiently manage GS projects. Additionally, States can use multiple authorities beyond those afforded under the SDWA including surface access and land ri ghts, unitization of fields, pore space ownership, mineral rights, si te safety and emergency preparedness, and maximization of State oil and gas resource exploitation.

In addition, EPA is developing guidances for states that describe the process of applying for and receiving primary enforcement responsibility (p rimacy) for GS Class VI wells under Section 1422 of SDWA, as well as the tech nical and administrative issues on developing GS regulations that are the equivalent of mi nimum federal criteria and requ irements. The guidance will be available at http://water.epa.gov/type/g roundwater/uic/wells _sequestration.cfm.

EPA also clarifies that primacy is granted to a state, not to any agency within that state, and states are free to choose which agency will im plement the Class VI program—for instance, an environmental quality protection agency (non-Cl ass II) or the state's traditional oil and gas regulatory agency (Class II)—as long as the program meets the minimum federal requirements for Class VI wells as required under section 1422 of SDWA. Some stat es administer their program for all injection well classes through a single agency, whereas other States elect to divide the program between agencies. EPA believes that retaining this flexibility for States to identify the appropriate agency to oversee Class VI wells will address commenters’ concerns that States should be afforded the opportunity to de termine which agency should oversee Class VI wells, and recognizes the existing expertise of bot h State oil and gas agen cies and environmental agencies.

Letter ID: 0239 Comment ID: 23216 Letter Lines: 72 to 80

Comment Code: 2064 1.5.3.2 Grandfathering construction of Class II wells (seeking comment)

Comment: Finally, we think EPA’s propos ed grandfathering requireme nts are too restrictive and will prevent or discourage entities from converting Class II EOR wells to Class VI wells. EPA has proposed to only allow the construction requirements to be "grandfathered" based on the UIC progr am director’s discretion while all other requirements would apply. There is no reason to limit the grandfathering of requirements for existing CO2 EOR wells that have proven to pose no endangerment to underground sources of dr inking water. We think EPA should

34 expand the scope of grandfathering require ments for these types of wells and limit additional Class VI requirements. Ag ain, we appreciate the opportunity to

Individual Response: EPA agrees that many Class II well s are designed and constructed to withstand exposure to CO2. The final GS rule provi des for the construction of these wells to be grandfathered per §146.81(c), provid ed the owner or operator can demonstrate to the Director that the wells were engineered and constructed to meet th e requirements at §146.86(a) and ensure protection of USDWs, in lieu of requirements at §146.86(b) and §146.87(a).

EPA disagrees that other requirements (e.g., MITs, siting, monitoring, operational, and AoR requirements) should also be grandfathered. Fo llowing re-permitting of the well as Class VI, many of the unique factors of GS sites (e.g., increa sed reservoir pressures associated with large volumes of stored CO2 and the corrosivity of CO 2 in the presence of water) will result in an increased risk profile, warranti ng the specific requirements in the final GS rule. Therefore, following re-permitting as Class VI wells, these proj ects must be subject to the operational, MIT, monitoring, reporting, plugging, and post- injection site care and site closure requirements in the

final GS rule. See the discussion of EPA's final regulatory approach in the preamble to the GS rule for additional detail on these requirements.