A 4.4 magnitude earthquake that shook the largest U.S. shale field on Wednesday could lead to further restrictions on how operators there can dispose of saltwater associated with their oil and gas production, analysts said.
The quake was the largest yet in the Stanton Seismic Response Area (SRA), a swath of the Permian basin near Midland, Texas, where regulators were already monitoring seismic activity linked to disposal of saltwater, a natural byproduct of oil and gas production.
The Railroad Commission of Texas(RRC), which regulates the state’s oil and natural gas industry, in 2022 developed a plan that aimed to prevent earthquakes measuring over magnitude 3.5 in that area by mid-May of this year.
Some deep-water disposal wells in the Stanton area were already shut as part of that plan.
“The only risk is that the event will trigger an expansion of the SRA,” said Kelly Bennett, CEO of water analytics firm B3 Insights, adding that production in the area is unlikely to be affected.
The RRC in January of this year banned saltwater disposal injection in a separate part of the Permian, called the Northern Culberson-Reeves Seismic Response Area, after a series of seven earthquakes measuring up to magnitude 5.2 occurred in a span of just five weeks towards the end of last year.
That ban applied to 23 disposal wells in the area and impacted producers including Chevron, BP and Coterra Energy.
It unclear whether the RRC will enforce additional restrictions in Stanton after Wednesday’s earthquake, said Laura Capper, chief executive of EnergyMakers Advisory Group, a water management and risk mitigation consultancy.
“But that was a noteworthy magnitude we wish to avoid”, she added.
(Reporting by Georgina McCartney in Houston; Editing by Liz Hampton and David Gregorio)
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