--> Abstract: Environmental Assessments and Audits of Oil and Gas Properties; How to Identify and Minimize Liability, by S. Keefer and J. A. Celmer-Bricmont; #90987 (1993).

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KEEFER, STEFFANIE, and JEANNE A. CELMER-BRICMONT, Geraghty and Miller, Inc., Tulsa, OK

ABSTRACT: Environmental Assessments and Audits of Oil and Gas Properties; How to Identify and Minimize Liability

Environmental site assessments and audits have been used by the manufacturing and financial communities for several years to identify areas of environmental liability. As the oil and gas industry becomes increasingly regulated, it is critical to identify, evaluate, and reduce environmental liability through site assessments and audits during transfer of oil and gas properties. It is the buyer's responsibility to exercise due diligence when purchasing properties to establish an innocent landowner defense should contamination be discovered after ownership is assumed. Many wastes generated during drilling, production, and some processing operations have been specifically exempt from regulation as hazardous wastes under the Resource conservation and Recovery Act; however, this exclusion d es not exempt a site from liabilities incurred under other environmental statutes including the comprehensive Environmental Response, Compensation and Liability Act, the Clean Water Act, the Oil Pollution Act, or the Endangered Species Act. Under these statutes, liability may be strict (the Exxon Valdez case), or joint and several (the recent case in Laguna Quatro, New Mexico) and can result in large civil and criminal penalties.

Site assessments can be conducted at various levels of detail but all should include a site visit, interviews with knowledgeable personnel, and a records review to document land uses and conditions for a period of 50 years. A Phase I assessment should confirm present land uses and identify areas which may require further investigation. Phases II and III assessments document the presence and extent of contamination of the properties by collecting soil and ground-water samples.

AAPG Search and Discovery Article #90987©1993 AAPG Annual Convention, New Orleans, Louisiana, April 25-28, 1993.