ARIZONA DEPARTMENT OF WATER RESOURCESPotential Authorization, Permitting and Reporting

Requirements for Cathodic Protection Service WellsWestern Regional Gas Conference

August 27, 2008

A. Cathodic protection and corrosion control.

1. Most metals begin as ore, a naturally occurring deposit which contains a mineral, or minerals often occurring in veins, which are ore-filled fissures in rock. Ore bodies are formed by a variety of geological processes. Nearly all rock deposits contain some metallic minerals. After the ore is mined, the metals are extracted. The process of reducing metals from their ores by fire is called smelting which uses carbon in the form of charcoal as the reducing agent. Significant energy must be input to reduce the ore to a pure metal. Corrosion can be viewed as the tendency of a metal to revert back to its natural state (ore). Metal corrosion involves both chemical reactions and the flow of electrons.

2. Cathodic protection is a means of protecting metal structures such as pipelines, storage tanks, and oil well casings from corrosion by converting all of the anodic (active) sites on

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the metal surface to cathodic (passive) sites by supplying electrical current (or free electrons) from an alternate source. Anodes made from metal that is more active, i.e., more conducive to chemical reaction than the metal being protected, are connected by wire to the protected metal (cathode) and buried in the ground where they supply current and produce electrons (electric current is the flow of electrons). The electrons are transferred through the connecting wire to the cathode. Because these anodes are more active, the corrosive current will exit from them rather than the cathode. Thus, the cathode is protected while the attached anode is "sacrificed."

B. The Arizona Department of Water Resources (Department) has legal authority to regulate wells and well drilling in Arizona pursuant to the Groundwater Code (A.R.S. Title 45, Chapter 2).

1. Arizona Revised Statute (A.R.S.) § 45-402(43).“Well” means a man-made opening in the earth through which water may be withdrawn or obtained from beneath the surface of the earth except as provided in A.R.S. § 45-591.01.

2. Arizona Administrative Code (A.A.C.) R12-15-802.

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This Article shall apply to wells as defined in A.R.S. § 45-402(43) and geothermal wells to the extent provided in A.R.S. § 45-591.01 and all mineral exploration wells and grounding or cathodic protection holes greater than 100 ft. in depth.

A.A.C. R12-15-802 does not apply to:

a. R12-15-802(1):i. Construction and mining blast holes;

ii. Underground mines and mine shafts;

iii. Open pit mines;

iv. Tunnels;

v. Septic tank systems;

vi. Caissons;

vii. Basements; and

viii. Natural gas storage cavities.

b. R12-15-802(2): Injection wells and vadose zone wells which are subject to regulation by the Arizona Department of Environmental Quality (ADEQ).

c. R12-15-802(3): Oil, gas and helium wells drilled pursuant to the provisions of A.R.S. Title 27.

d. R12-15-802(4): Drilled boreholes in the earth less than 100 ft. in depth which are made for purposes other than withdrawing or encountering groundwater, such as exploration wells and grounding or cathodic protection holes; except that in the event that groundwater is encountered in the drilling of a borehole, A.A.C. Title 12, Chapter 15, Article 8 shall apply.

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C. How could this potentially affect deep anode groundbeds?

1. Wells and well drilling may be subject to Department regulation when:

a. The boring is greater than 100 ft. deep;

b. The boring is less than 100 ft. deep and is intended to encounter groundwater; or

c. The boring is less than 100 ft. deep and encounters groundwater.

2. Wells that will not be pumped do not require a water right or groundwater withdrawal permit, however:

a. The Notice of Intent (NOI) to Drill and Abandon an Exploration/Specialty Well (DWR 55-43B) must be filed prior to drilling an exploration or specialty well that will be drilled and abandoned before the drill rig leaves the site. Exploration and specialty wells include mineral exploration wells, geotechnical wells, cathodic protection wells, grounding wells and heat pump wells. All have purposes other than pumping water. A separate NOI must be filed for each well; however, a single NOI may be filed for all wells that are drilled by or for the same person to obtain geophysical, mineralogical or geotechnical data within a single section of land.

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b. Minimum well construction standards are defined in A.A.C. R12-15-811. All well construction must be consistent with these requirements including a surface seal that extends at least 20 feet including a steel well casing extending from at least 1 foot above grade through the required 20 feet. The casing must be at least 3 inches smaller in diameter than the borehole – 4 inches in known areas of contamination. The minimum one and a half inch space between the borehole and the casing must be filled with an acceptable grout mix. A variance may be requested to deviate from these standards (see E).

c. Drilling must be authorized by the Department, A.R.S. §§ 45-596 and 45-597 and must be completed by a licensed well drilling contractor.

The Department processes many applications to install cathodic protection service wells (576 known cathodic wells, but prior to the mid-1980’s exploration, cathodic, grounding and heat pump wells were recorded under one identification code that identified them as non-water production wells). Typical deep well ground bed design includes borings about 200 feet deep and 10 inches in diameter. A steel casing may be used to prevent the drilled hole from collapsing while the anodes are being set. This casing will be consumed when the ground bed becomes active.

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D. Procedures when cathodic protection wells or other soil borings are subject to any parts of the Groundwater Code.

1. Hire an appropriately licensed well driller. Construction, deepening, modification and abandonment of a well in Arizona must be performed under the supervision of a licensed well driller. Unless drilling on one’s own property, the driller must be currently licensed by ADWR and hold a valid contractor’s license administered by the Arizona Registrar of Contractors (ROC). To drill a cathodic protection service well, the drilling contractor’ license classification must be A, General Engineering or A-4, Drilling (commercial). If the driller is only drilling on their own property, they must have an ADWR Full time driller’s license but do not need a contractor’s license.

2. Submit to the Department * . a. A completed and signed NOI to Drill and Abandon an Exploration/Specialty Well

(DWR 55-43B) form (available at any Department location or online at: www.azwater.gov/dwr/Content/Find_by_Program/Wells);

b. A diagram of the proposed well construction (or abandonment); and

c. The $150.00/well filing fee. There is no fee associated with the filing of a variance or with the NOI to Abandon a Well (DWR 55-38) form.

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*NOTE: In some cases the well driller may be able to complete this process using the online electronic filing system (eNOI), in which case (if the application meets all of the Department’s requirements) issuance of the drilling authority is instantaneous.

3. Known areas of contamination.If the well is to be located within a known area of contamination (WQARF, CERCLA, DOD, VRP, UST, NPL or RCRA) or a 1 mile boundary of such area the proposed construction details may be reviewed by a Hydrologist in the Water Quality Unit. Drilling in or near a contamination site may be subject to additional construction requirements depending on the nature of the site (multiple alluvial units with confining layers, etc.).

4. Review period.The Department has 30 days to complete the review, unless a variance is requested. When a variance is requested, the review period is 50 days.

5. Amended NOI/reissued drill card. Amendments are changes including well information, ownership and/or driller between when the application is received and when the drilling is completed. Changes reported after the drilling authority has been issued and before the well has been drilled may require

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re-issuance of the card. Changes of ownership and driller have a $10.00 fee, and re-issued drill cards cost $10.00. Use the Change of Well Information (DWR 55-71A) form to report these changes.

6. Drill card.Upon approval, the Department will notify the well owner and the driller of the determination. When the driller is in receipt of the drill card, drilling may commence, but not sooner. The drilling authority is valid one year from the date the Department receives the Notice of Intent application.

E. Request for variance from the minimum well construction standards

1. If extraordinary or unusual conditions exist, an applicant or well drilling contractor may request to deviate from well construction standards (A.R.S. §§ 45-594 & 596 and A.A.C. R12-15-811 & 812) by submitting a letter describing the request and why it is necessary. The request is considered based on the nature of the well site (contamination now or in the future, characteristics of the geologic layers, confined or unconfined aquifer and other land specific features) and use of the well, and will only be considered when it is demonstrated that the variance will not adversely affect other water users or the environment. A variance request has no associated fee, and the review period is 50 days.

2. Common variance requests include:

a. No casing or the use of PVC casing in lieu of steel in the top 20 feet of the well;

b. Reduction of the 20 foot surface seal standard. A.A.C. R12-15-811(B) requires all wells and well abandonments to have a 20 ft. surface seal. For construction purposes, this means the top 20 ft. of the well must have blank steel casing at least 3 inches smaller in diameter than the borehole. The 1½ inch annular space must be filled with an allowable grout mixture (for wells located inside or within one mile of a known area of contamination, the requirement is a 4 inch difference/2 inch annular space).

c. Drilling within less than 100 feet from a septic system, and

d. Use of non-specified fill material. The Department allows various substances to be used to fill the hole including sand-bentonite grout, neat cement, concrete, cement-bentonite-grout, etc., but does not address common carbonaceous cathodic fills such

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as coke breeze (bituminous coal processed into coke and screened; and the tiny particles that separate in the screening process are labeled coke breeze) or fly ash (residue from coal combustion generally captured in chimneys at power generating facilities).

F. After the well is drilled.

1. Cathodic protection and fill/abandonment.The NOI to Drill and Abandon an Exploration/Specialty Well (DWR 55-43B) allows the applicant to file for both the drilling and the abandonment authorities simultaneously using a single form.

Wells drilled for the purpose of cathodic protection, grounding and heat pumps involve drilling for the purpose of grouting something (anodes, electrodes, tubing) in place. In these types of wells, the installation of grout serves the purpose of abandonment, and a separate process is not necessary. The wells remain active in the Department’s WELLS55 database.

Generally, there are two approaches to completing the form for cathodic protection, either of which is acceptable to the Department:

a. Complete Section 5, Proposed Well Construction Plan BUT NOT Section 6, Proposed Well Abandonment Design*. The construction plan includes the characteristics of the borehole, the casing is noted if one is used, and the “Annular Fill” box is completed with the details of the grout applied to secure the anode(s). Section 6 is left blank.

b. Complete Section 5, Proposed Well Construction Plan AND Section 6, Proposed Well Abandonment Design*. The construction plan includes the characteristics of the borehole, the casing is noted if one is used, and the “Annular Fill” box is left blank. Section 6 is completed to describe the abandonment design, which is actually the grout used to secure the anode(s).

*NOTE: Section 6 includes the proposed abandonment method and emplacement method. If Section 6 is completed, this information must be reported. If Section 6 is not addressed, this area may be left blank. Please note that it is recommended for best performance to tamp the fill around the anode(s).

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2. Deepenings and Modifications.When a well is being deepened or modified in such way as to change the casing, for example re-perforating, adding or changing of casing, or changing any other aspect of the well’s construction not normally associated with general well maintenance, pump replacement or pump repair, it falls under the definition of well drilling and is subject to the NOI application process. The NOI to Drill and Abandon an Exploration/Specialty Well (DWR 55-43B) form is used to apply for a deepening or modification, but you must note “deepening” or “modification” as applicable in Section 1 of the form.

3. Well Driller Report and Well Log (DWR 55-55).When the driller has finished drilling a well, they have 30 days to submit the completed Well Driller’s Report and Well Log to the Department. Once a drilling authority has expired and more than one month has passed since the expiration and the DWR 55-55 hasn’t been filed, the well will be cancelled under the assumption it has not been drilled.

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4. Change of Well Information (DWR 55-71A).Use this form to report changes that occur after a Notice of Intent to Drill has been submitted, for example changing drillers, ownership or other information about the well. Changes of driller and ownership have a $10.00 fee. Requests to change drillers will require reissuance of the drilling authority. The new driller may not begin drilling until they receive the new drill card.

G. Discovery of Existing Wells.

1. Unanticipated previously registered wells.In conducting a site inventory wells may be discovered on the property that were not anticipated. The wells may have been registered with the Department in the past and have a record on file. They may not have been associated with the property because they have been registered with an incorrect legal description, for example the quarter sections may be inverted. The owner of the property where such well is located is obligated to contact the Department to resolve any potential discrepancies and make the necessary updates to the well record.

2. Unregistered wells.Occasionally a well is discovered that has not been registered, either because the well was drilled before June 12, 1980 (the date the Groundwater Code became effective) and the owner never completed the registration process or the well was drilled after June 12, 1980

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without the required legal authority. The owner of the property where such well is located is obligated to report the well to the Department by completing and submitting the Late Registration of a Well (DWR 55-65) form. The fee for late registration is $10.00. Non-exempt wells have an additional $10.00 registration fee. There are no licensing timeframes for late registrations, but the process is completed as efficiently as possible to keep the ADWR Well Registry current. The Department requests the applicant provide as much information as they are able about the well, but understands the party who originally caused the well to be drilled may be unavailable and data may be limited.

a. If an unanticipated well is discovered and the property owner registers the well or changes the ownership into their name, they may be able to use the well if they wish to do so. If the well was constructed for a purpose other than that desired by the new owner (e.g., an old irrigation well is discovered and the new owner wants to use the boring to install anodes), an application to modify the well is needed if any addition of casing or change to existing casing construction, and/or any other change in well construction not normally associated with well maintenance, pump replacement, or pump repair is being done. The request to modify is filed on the Notice of Intent (NOI) to Drill and Abandon an Exploration/Specialty Well (DWR 55-43B) is used, and “modification” is noted on the front of the form. The review period and fees are the same as for an original application.

b. If an unanticipated well is discovered and the property owner does not want the well, the well may be capped for potential future use or it may be abandoned. Please note that in order to be in compliance with the Groundwater Code, a well must be equipped with a pump, abandoned or capped. Caps must be water proof and tamper resistant.

3. Open wells.Within 30 days after a change of ownership of real property, the new owner shall notify the Department of the existence of any open well or wells on the property which the new owner has discovered. Thereafter the new owner shall report the existence of any open well on the property within 10 days after the owner discovers the well.

When the Department receives reports of open wells, the status of that well is verified through the inspection process. If there is an open well, the well owner is contacted and if they are unable to quickly remedy the situation, the Department caps the well until the well owner is able to install their own capping device and return the Department’s device. In this situation, the well owner is advised they have 30 days from the date the Department capped the well to secure their own cap or file an application to abandon the well.

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H. Water production wells and Active Management Areas (AMA).

1. A.R.S. § 45-402(2):“Active Management Area” means a geographical area which has been designated pursuant to Article 2 of the Groundwater Code as requiring active management of groundwater or, in the case of the Santa Cruz AMA, active management of any water, other than stored water, withdrawn from a well.

The AMAs include:

a. Phoenix: East and West Salt River valley, Fountain Hills, Carefree, Lake Pleasant, Rainbow Valley and Hassayampa sub-basins;

b. Pinal: Maricopa-Stanfield, Eloy, Aguirre Valley, Santa Rosa Valley and Vekol Valley sub-basins;

c. Prescott: Little Chino and Upper Agua Fria sub-basins;

d. Santa Cruz: (part of) Upper Santa Cruz Valley sub-basin; and

e. Tucson: Upper Santa Cruz and Avra Valley sub-basins.

2. Some production wells are exempt from certain provisions of the Groundwater Code.

a. Water production wells subject only to certain requirements of the Groundwater Code including A.R.S. §§ 45-454, 45-594 – 45-597, 45-600, 45-602, etc., but do not require a water right (Articles 5 & 6), withdrawal authority (Article 7), well construction permit (A.R.S. §§ 45-598 & 45-599), impact study (A.A.C. R12-15-830), measuring device (A.R.S. § 45-604), withdrawal fees (A.R.S. §§ 45-611 – 45-615) or annual reporting (A.R.S. § 45-632) include:

i. Exempt wells: Wells equipped to pump 35 GPM or less located anywhere in the State, with certain use and volume limitations inside AMAs; and

ii. Wells equipped to pump any volume located outside AMAs.

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b. The filing process is similar to that described in “C” above, but requires the Notice of Intent to Drill, Deepen, Replace or Modify a Well (DWR 55-40) application form rather than the DWR 55-43B. Filing fees are the same, except certain exempt wells located outside AMAs [and Irrigation Non-Expansion Areas as defined in A.R.S. § 45-402(22)] have a fee of $100.00/well. The Department’s review time frame is 15 days.

3. Wells designed to pump greater than 35 gallons per minute that are located inside AMAs are subject to all well construction requirements contained in the Code.

Non-exempt wells (water production wells equipped to pump greater than 35 GPM) located within AMAs are subject to well construction permit requirements, installation of a water measuring device, completion of an impact study, pumping only pursuant to a grandfathered water right, a service area right or a withdrawal permit, annual withdrawal fees and annual reporting of the quantity of groundwater withdrawn during the calendar year.

4. Upon completing the drilling of any water production well, the well driller has 30 days to submit the Well Driller Report and Well Log (DWR 55-55) to the Department. If a pump is installed, the well owner has 30 days from the date of installation to submit the Pump Installation Completion Report (DWR 55-56).

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5. Abandoning a water production well is a separate process that requires the filing and approval of the Notice of Intent to Abandon (DWR 55-38) prior to initiating the abandonment activity. There is no filing fee for abandonments.

I. Contacting the Arizona Department of Water Resources.

1. Office locations, phone (P) numbers and fax (F) numbers:

Central Office and Phoenix AMA Pinal AMA3550 North Central Avenue, Suite 200 1729 North Trekell Road, Suite 105Phoenix AZ 85012-2105 Casa Grande, AZ 85222-1743(602) 771-8500 (P)*, (602) 771-8691 (F) (520) 836-4857 (P)*, (520) 836-9208 (F)

Prescott AMA Santa Cruz AMA2200 East Hillside Road 857 West Bell Road, Suite 3Prescott, AZ 86301-4941 Nogales, AZ 85621-4545(928) 778-7202 (P)*, (928) 776-4507 (F) (520) 761-1814 (P)*, (520) 761-1869 (F)

Tucson AMA400 West Congress, Suite 518Tucson, AZ 85701-1374(520) 770-3800 (P)*, (520) 628-6759 (F)

*NOTE: The Department may also be contacted at toll free number 1-800-352-8488 if calling from within Arizona.

2. Department website. www.azwater.gov

All forms used in the well application and well file maintenance process are available on the website at http://www.azwater.gov/dwr/Content/Find_by_Program/Wells/.

3. Post Office Box.Arizona Department of Water ResourcesNotice of Intent UnitP.O. Box 33589 Phoenix, Arizona 85067-3589

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