A HISTORY OF CALIFORNIA'S DIVISION OF OIL, GAS, AND GEOTHERMAL RESOURCES

Thousands of years after humans’ first use of California's petroleum and 50 years after drilling California's first oil well, the California Legislature in 1915, with the support of the petroleum industry, created a State-level regulatory agency to curtail abuse of this natural resource. Preventing reservoir damage from wells lacking competent water zone isolation and collecting well and production records were initial goals for the Department of Petroleum and Gas of the State Mining Bureau.

Historically, the Division of Oil, Gas, and Geothermal Resources (Division) authority and enforcement has been reactionary to issues involving California's oil industry. Revisions in 1929 addressed the unreasonable waste of gas, which was a common practice to get to the oil hydrocarbons. California's "law of capture" for oil fields generated haphazard townlot drilling of wells and overproduction which were addressed in 1931 statutory amendments that detailed spacing requirements. This 1931 amendment also introduced the first bonding requirement to address wells that operators deserted. Although offshore wells were drilled as early as 1897, it was not until 1921 that the State Legislature passed a tidelands leasing act. This allowed the more orderly development of the offshore reserves. In the 1960's the Geysers Geothermal field in Sonoma and Lake Counties was developed. In September 1965 the regulation of geothermal wells was added to the Division. In 1970, Division authority was expanded considerably to prevent “…damage to life, health, property, and natural resources…” this trend continues today. In 1990, the Division improved its idle/orphan well abatement program by increasing financial insurance requirements, thereby, decreasing the State’s future liability for deserted oil and gas wells, and providing incentives to allow an operator to rework an orphaned well in an attempt to regain production.

As the Division looks to the future, its core programs will continue to protect the citizens of the State, the environment, and natural resources. Ongoing and additional challenges include the elimination of long-term idle wells and the remediation of derelict/idle lease facilities.