1. (a) General criteria. The director may issue a permit under this subchapter if the applicant demonstrates and the director finds that:

   1. (1) the injection and geologic storage of anthropogenic CO₂ will not endanger or injure any existing or prospective oil, gas, geothermal, or other mineral resource, or cause waste as defined by Texas Natural Resources Code, §85.046(11);
   2. (2) with proper safeguards, both underground sources of drinking water and surface water can be adequately protected from CO₂ migration or displaced formation fluids;
   3. (3) the injection of anthropogenic CO₂ will not endanger or injure human health and safety;
   4. (4) the reservoir into which the anthropogenic CO₂ is injected is suitable for or capable of being made suitable for protecting against the escape or migration of anthropogenic CO₂ from the storage reservoir;

   5. (5) the geologic storage facility will be sited in an area with suitable geology, which at a minimum must include:

      1. (A) an injection zone of sufficient areal extent, thickness, porosity, and permeability to receive the total anticipated volume of the CO₂ stream; and
      2. (B) a confining zone(s) that is laterally continuous and free of known transecting transmissive faults or fractures over an area sufficient to contain the injected CO₂ stream and displaced formation fluids and allow injection at proposed maximum pressures and volumes without compromising the confining zone or causing the movement of fluids that endangers underground sources of drinking water;
   6. (6) the applicant for the permit meets all of the other statutory and regulatory requirements for the issuance of the permit;
   7. (7) the applicant has provided a letter from the Executive Director of the Texas Commission on Environmental Quality in accordance with §5.203(o) of this title (relating to Application Requirements);
   8. (8) the applicant has provided a signed statement that the applicant has a good faith claim to the necessary and sufficient property rights for construction and operation of the geologic storage facility for at least the first five years after initiation of injection in accordance with §5.203(d)(1)(A) of this title;
   9. (9) the applicant has paid the fees required in §5.205(a) of this title (relating to Fees, Financial Responsibility, and Financial Assurance);
   10. (10) the director has determined that the applicant has sufficiently demonstrated financial responsibility as required in §5.205(b) of this title; and
   11. (11) the applicant submitted to the director financial assurance in accordance with §5.205(c) of this title.

2. (b) Injection well construction.

   1. (1) Construction of anthropogenic CO₂ injection wells must meet the criteria in §5.203(e) of this title.
   2. (2) Within 30 days after the completion or conversion of an injection well subject to this subchapter, the operator must file with the division a complete record of the well on the appropriate form showing the current completion.
   3. (3) Except in the case of an emergency repair, the operator of a geologic storage facility must notify the director at least 48 hours, and obtain the director's approval, prior to conducting any well workover that involves running tubing and setting packer(s), beginning any workover or remedial operation, or conducting any required pressure tests or surveys. In the case of an emergency repair, the operator must notify the director of such emergency repair as soon as reasonably practical.

3. (c) Operating a geologic storage facility.

   1. (1) Operating plan. The operator must maintain and comply with the approved operating plan.

   2. (2) Operating criteria.

      1. (A) Injection between the outermost casing protecting underground sources of drinking water and the well bore is prohibited.
      2. (B) The total volume of CO₂ injected into the storage facility must be metered through a master meter or a series of master meters. The volume of CO₂ injected into each injection well must be metered through an individual well meter.
      3. (C) The operator must comply with a maximum surface injection pressure limit approved by the director and specified in the permit. In approving a maximum surface injection pressure limit, the director must consider the results of well tests and, where appropriate, geomechanical or other studies that assess the risks of tensile failure and shear failure. The director must approve limits that, with a reasonable degree of certainty, will avoid initiation or propagation of fractures in the confining zone or cause otherwise non-transmissive faults or fractures transecting the confining zone to become transmissive. In no case may injection pressure cause movement of injection fluids or formation fluids in a manner that endangers underground sources of drinking water. The director may approve a plan for controlled artificial fracturing of the injection zone.
      4. (D) The operator must fill the annulus between the tubing and the long string casing with a corrosion inhibiting fluid approved by the director.
      5. (E) The operator must install and use continuous recording devices to monitor the injection pressure, and the rate, volume, and temperature of the CO₂ stream. The operator must monitor the pressure on the annulus between the tubing and the long string casing. The operator must continuously record, continuously monitor, or control by a preset high-low pressure sensor switch the wellhead pressure of each injection well.

      6. (F) The operator must comply with the following requirements for alarms and automatic shut-off systems.

         1. (i) The operator must install and use alarms and automatic shut-off systems designed to alert the operator and shut-in the well when operating parameters such as annulus pressure, injection rate or other parameters diverge from permitted ranges and/or gradients. On offshore wells, the automatic shut-off systems must be installed down-hole.

         2. (ii) If an automatic shutdown is triggered or a loss of mechanical integrity is discovered, the operator must immediately investigate and identify as expeditiously as possible the cause. If, upon investigation, the well appears to be lacking mechanical integrity, or if monitoring otherwise indicates that the well may be lacking mechanical integrity, the operator must:

            1. (I) immediately cease injection;
            2. (II) take all steps reasonably necessary to determine whether there may have been a release of the injected CO₂ stream into any unauthorized zone;
            3. (III) notify the director as soon as practicable, but within 24 hours;
            4. (IV) restore and demonstrate mechanical integrity to the satisfaction of the director prior to resuming injection; and
            5. (V) notify the director when injection can be expected to resume.
4. (d) Monitoring, sampling, and testing requirements. The operator of an anthropogenic CO₂ injection well must maintain and comply with the approved monitoring, sampling, and testing plan to verify that the geologic storage facility is operating as permitted and that the injected fluids are confined to the injection zone. The director may require additional monitoring as necessary to support, upgrade, and improve computational modeling of the area of review evaluation and to determine compliance with the requirement that the injection activity not allow movement of fluid that would endanger underground sources of drinking water.

5. (e) Mechanical integrity.

   1. (1) The operator must maintain and comply with the approved mechanical integrity testing plan submitted in accordance with §5.203(j) of this title.
   2. (2) Other than during periods of well workover in which the sealed tubing-casing annulus is of necessity disassembled for maintenance or corrective procedures, the operator must maintain mechanical integrity of the injection well at all times.
   3. (3) The operator must either repair and successfully retest or plug a well that fails a mechanical integrity test.
   4. (4) The director may require additional or alternative tests if the results presented by the operator do not demonstrate to the director that there is no leak in the casing, tubing, or packer or movement of fluid into or between formations containing underground sources of drinking water resulting from the injection activity.

6. (f) Area of review and corrective action. Notwithstanding the requirement in §5.203(d)(2)(B)(i) of this title to perform a re-evaluation of the area of review, at the frequency specified in the area of review and corrective action plan or permit, the operator of a geologic storage facility also must conduct the following whenever warranted by a material change in the monitoring and/or operational data or in the evaluation of the monitoring and operational data by the operator:

   1. (1) a re-evaluation of the area of review by performing all of the actions specified in §5.203(d)(1)(A) - (C) of this title to delineate the area of review and identify all wells that require corrective action;
   2. (2) identify all wells in the re-evaluated area of review that require corrective action;
   3. (3) perform corrective action on wells requiring corrective action in the re-evaluated area of review in the same manner specified in §5.203(d)(1)(C) of this title; and
   4. (4) submit an amended area of review and corrective action plan or demonstrate to the director through monitoring data and modeling results that no change to the area of review and corrective action plan is needed.

7. (g) Emergency, mitigation, and remedial response.

   1. (1) Plan. The operator must maintain and comply with the approved emergency and remedial response plan required by §5.203(l) of this title. The operator must update the plan in accordance with §5.207(a)(2)(D)(vi) of this title (relating to Reporting and Record-Keeping). The operator must make copies of the plan available at the storage facility and at the company headquarters.

   2. (2) Training.

      1. (A) The operator must prepare and implement a plan to train and test each employee at the storage facility on occupational safety and emergency response procedures to the extent applicable to the employee's duties and responsibilities. The operator must make copies of the plan available at the geological storage facility. The operator must train all employees before commencing injection and storage operations at the facility. The operator must train each subsequently hired employee before that employee commences work at the storage facility.
      2. (B) The operator must hold a safety meeting with each contractor prior to the commencement of any new contract work at a storage facility. The operator must explain emergency measures specific to the contractor's work in the contractor safety meeting.
      3. (C) The operator must provide training schedules, training dates, and course outlines to Commission personnel upon request for the purpose of Commission review to determine compliance with this paragraph.

   3. (3) Action. If an operator obtains evidence that the injected CO₂ stream and associated pressure front may cause an endangerment to underground sources of drinking water, the operator must:

      1. (A) immediately cease injection;
      2. (B) take all steps reasonably necessary to identify and characterize any release;
      3. (C) notify the director as soon as practicable but within at least 24 hours; and
      4. (D) implement the approved emergency and remedial response plan.
   4. (4) Resumption of injection. The director may allow the operator to resume injection prior to remediation if the operator demonstrates that the injection operation will not endanger underground sources of drinking water.
8. (h) Commission witnessing of testing and logging. The operator must provide the division with the opportunity to witness all testing and logging. The operator must submit a proposed schedule of such activities to the Commission at least 30 days prior to conducting the first test and submit notice at least 48 hours in advance of any actual testing or logging. Testing and logging may not commence before the end of the 48-hour period unless authorized by the director.
9. (i) Well plugging. The operator of a geologic storage facility must maintain and comply with the approved well plugging plan required by §5.203(k) of this title.

10. (j) Post-injection storage facility care and closure.

    1. (1) Post-injection storage facility care and closure plan.

       1. (A) The operator of an injection well must maintain and comply with the approved post-injection storage facility care and closure plan.
       2. (B) The operator must update the plan in accordance with §5.207(a)(2)(D)(vi) of this title.
       3. (C) Upon cessation of injection, the operator of a geologic storage facility must either submit an amended plan or demonstrate to the director through monitoring data and modeling results that no amendment to the plan is needed.
    2. (2) Post-injection storage facility monitoring. Following cessation of injection, the operator must continue to conduct monitoring as specified in the approved plan until the director determines that the position of the CO₂ plume and pressure front are such that the geologic storage facility will not endanger underground sources of drinking water.

    3. (3) Prior to closure. Prior to authorization for storage facility closure, the operator must demonstrate to the director, based on monitoring, other site-specific data, and modeling that is reasonably consistent with site performance that no additional monitoring is needed to assure that the geologic storage facility will not endanger underground sources of drinking water. The operator must demonstrate, based on the current understanding of the site, including monitoring data and/or modeling, all of the following:

       1. (A) the estimated magnitude and extent of the facility footprint (the CO₂ plume and the area of elevated pressure);
       2. (B) that there is no leakage of either CO₂ or displaced formation fluids that will endanger underground sources of drinking water;
       3. (C) that the injected or displaced fluids are not expected to migrate in the future in a manner that encounters a potential leakage pathway into underground sources of drinking water;
       4. (D) that the injection wells at the site completed into or through the injection zone or confining zone will be plugged and abandoned in accordance with these requirements; and
       5. (E) any remaining facility monitoring wells will be properly plugged or are being managed by a person and in a manner approved by the director.
    4. (4) Notice of intent for storage facility closure. The operator must notify the director at least 120 days before storage facility closure. At the time of such notice, if the operator has made any changes to the original plan, the operator also must provide the revised plan. The director may approve a shorter notice period.
    5. (5) Authorization for storage facility closure. No operator may initiate storage facility closure until the director has approved closure of the storage facility in writing. After the director has authorized storage facility closure, the operator must plug all wells in accordance with the approved plan required by §5.203(k) of this title.

    6. (6) Storage facility closure report. Once the director has authorized storage facility closure, the operator must submit a storage facility closure report within 90 days that must thereafter be retained by the Commission in Austin. The report must include the following information:

       1. (A) documentation of appropriate injection and monitoring well plugging. The operator must provide a copy of a survey plat that has been submitted to the Regional Administrator of Region 6 of the United States Environmental Protection Agency. The plat must indicate the location of the injection well relative to permanently surveyed benchmarks;
       2. (B) documentation of appropriate notification and information to such state and local authorities as have authority over drilling activities to enable such state and local authorities to impose appropriate conditions on subsequent drilling activities that may penetrate the injection and confining zones; and
       3. (C) records reflecting the nature, composition and volume of the CO₂ stream.
    7. (7) Certificate of closure. Upon completion of the requirements in paragraphs (3) - (6) of this subsection, the director will issue a certificate of closure. At that time, the operator is released from the requirement in §5.205(c) of this title to maintain financial assurance.

11. (k) Deed notation. The operator of a geologic storage facility must record a notation on the deed to the facility property; on any other document that is normally examined during title search; or on any other document that is acceptable to the county clerk for filing in the official public records of the county that will in perpetuity provide any potential purchaser of the property the following information:

    1. (1) a complete legal description of the affected property;
    2. (2) that land has been used to geologically store CO₂;
    3. (3) that the survey plat has been filed with the Commission;
    4. (4) the address of the office of the United States Environmental Protection Agency, Region 6, to which the operator sent a copy of the survey plat; and
    5. (5) the volume of fluid injected, the injection zone or zones into which it was injected, and the period over which injection occurred.
12. (l) Retention of records. The operator must retain for five years following storage facility closure records collected during the post-injection storage facility care period. The operator must deliver the records to the director at the conclusion of the retention period, and the records must thereafter be retained at the Austin headquarters of the Commission.
13. (m) Signs. The operator must identify each location at which geologic storage activities take place, including each injection well, by a sign that meets the requirements specified in §3.3(1), (2), and (5) of this title (relating to Identification of Properties, Wells, and Tanks). In addition, each sign must include a telephone number where the operator or a representative of the operator can be reached 24 hours a day, seven days a week in the event of an emergency.
14. (n) Other permit terms and conditions. In any permit for a geologic storage facility, the director must impose terms and conditions reasonably necessary to protect underground sources of drinking water. Permits issued under this subchapter continue in effect until revoked, modified, or suspended by the Commission. The operator must comply with each requirement set forth in this subchapter as a condition of the permit unless modified by the terms of the permit.

Source Note:The provisions of this §5.206 adopted to be effective December 20, 2010, 2010, 35 TexReg 11202.