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Are Natural Gas Prices Set To Spike?

Are Natural Gas Prices Set To Spike?

Natural gas inventories have plunged…

North Dakota Issues New Rules On Spill Containment

Pipeline

On Wednesday, industry regulators in North Dakota issued new rules to curb oil spills in the state. The new rules include third-party inspections on new pipelines and a six-inch clay dike that will prevent spills from spreading. Bonds will also be required to cover reclamation costs.

The Industrial Commission drafted the rules at the direction of the state legislature last year. In 2015, there was a 3 million-gallon saltwater pipeline leak near Williston. The water used in production has a higher salt content than sea water, and has the potential to contain petroleum and fracking residue.

The rules have been decried by companies working in North Dakota, who say that the measures will drive up production costs. The Department of Mineral Resources said that the new measures will cost around $3500 for each site. However, the North Dakota Petroleum Council expects the costs to be at least three times that amount.

Lynn Helms of the North Dakota Industrial Commission said that 4,000 well sites will be required to use the dikes, adding that the six-inch dike around a two-acre site can hold 8 thousand barrels of oil.

Related: Zombie Stocks Brought Back To Life By Lithium Boom

According to Helms, the dikes will keep 98 percent of spills contained in well sites, which should lower the risk of contamination.

The new rules are retroactive and the Industrial Commission will allow companies extensions to get the dikes into place by October.

Helms stated: “Industry recognized after the bad winter of 2010, 2011, that more needed to be done. Most of the operators began constructing perimeter dikes around their new sites at that time. They didn't go back and put perimeter dikes on the things they had previously constructed or drilled and so this is now going to apply to anything that's out there, even if it dates back to 1951."

The Administrative Rules Committee and the Attorney General’s office still need to approve the regulations

By Lincoln Brown from Oilprice.com

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