Brian Chastain is the President of Dynamix Engineering and Services Group, which supports businesses in the gas storage, utility services, and energy industries with project management solutions. Dynamix has been helping clients for over 45 years with site maintenance, replacement, and repurposing assets like wellheads and casing production tubing to remain compliant with industry standards. The company’s mission is to help others operate at their peak efficiency while minimizing their environmental impact.
Here’s a glimpse of what you’ll learn:
- What is the PHMSA mega rule and why is it important?
- Brian Chastain talks about orphan wells and how they overlap with PHMSA mega rule compliance
- How can companies take advantage of government funding to help locate, fix, and repair the orphan wells?
- How Dynamix ESG helps clients be PHMSA compliant and resolve staffing issues
- Brian explains how you can get approved for government funding
- Brian talks about the benefits of PHMSA mega rule compliance
- Brian explains how he got into the energy industry
In this episode…
How do you keep orphan wells PHMSA mega rule compliant — and not make the news?
It’s been discovered that there are millions of orphan wells that need to be properly plugged and abandoned, and the government has designated funds to help find, fix, and repair these orphan wells. There are also some things that you need to consider as a company to properly abandon a well. And that’s where Dynamix ESG comes in: they help you become PHMSA mega rule compliant and get approved for the government funds to create a cleaner, safer environment.
In this episode of the Project Dynamix Podcast, Brian Chastain, the President of Dynamix Engineering and Services Group, sits down with Dr. Jeremy Weisz, the Co-founder of Rise25, to discuss proper ways to abandon orphan wells and be PHMSA mega rule compliant. Brian talks about orphan wells and how they overlap with PHMSA compliance, the government funds designated to help locate, fix, and repair them (and how to get approved for that), and the benefits of PHMSA mega rule compliance.
Resources Mentioned in this episode
- Dynamix ESG
- Brian Chastain on LinkedIn
- Dynamix ESG email: email@example.com
- Dynamix ESG phone number: 724-716-4111
- Dr. Jeremy Weisz on LinkedIn
- “8 Considerations for PHMSA Mega Rule Compliance”
- “How To Be PHMSA Mega Rule Compliant”
Sponsor for this episode…
This episode is brought to you by Dynamix.
Dynamix is an engineering and services group on a mission to help companies achieve peak operational efficiencies with the smallest environmental footprint.
At Dynamix, we make sure the companies we work with do NOT make the news. Nobody wants their name in articles due to mishaps, but sadly, it happens all too often.
We have a team of experts that have been in the field for over 45 years. We take care of our clients and get them back up and running as quickly as possible by providing expert turnkey consulting services for their security needs.
Basically, if you are in the gas storage, utility services, or energy industry, we are your turnkey project management operation.
We fix, update, and repurpose assets like wellheads, casing, production tubing, site repair, and replacement. We bring clients above the industry standards and help them avoid regulatory penalties.
To learn more, email firstname.lastname@example.org or give us a call at 724-716-4111.
This is the Project Dynamix Podcast hosted by Brian Chastain, where he features top leaders in the energy markets to talk about innovation and impact.
Brian Chastain 0:16
Hi Brian Chastain here host of the Project Dynamix Podcast where I feature top leaders in the energy markets to talk about innovation and impact. I have Dr. Jeremy Weisz here from Rise25, who has done thousands of interviews with successful entrepreneurs and CEOs, we have flipped the script and he will be interviewing me this week.
Jeremy Weisz 0:38
Brian, I’m excited. And there’s a lot of talk about the PHMSA mega rule what it is, and there’s a lot that goes into it. So we’re going to discuss that and a couple other topics related to this. So before we dig into it, this episode is brought to you by Dynamix, and I know at Dynamix you make sure companies you work with, do not make the news, you’re the opposite of a PR company, you do not want the companies you work within the news. And I know you were talking about an article, one time that a company got a $53 million dollar fine. And that can happen to companies if they’re not following what they need to be following. So I know what you do. Basically, if you’re in gas storage, utility services or energy industry, you are a turnkey project management operation. And you fix, update and repurpose assets like wellheads casing production tubing site repair and replace. And you bring clients not just to industry standards, but above the industry standards. And Dynamix, for those of you out there isn’t engineering and services group on a mission to help companies achieve peak operational efficiencies with the smallest environmental footprint and your team of experts have been in the field for over 45 years. You can email info at dynamixesg.com, or give them a call at 724-716- 4111. And Brian, just give a little overview of the PHMSA mega rule and why it’s important first to start.
Brian Chastain 2:12
Yeah, so the I mean, the PHMSA mega rule, really, it goes back, to just start off. PHMSA is a Pipeline and Hazardous Materials Safety Administration. And it was formed a little over 10 years ago, mega rule started being built, it was built in response to multiple incidents across the country, that related to out of date equipment or improperly designated equipment that was being used at higher operating pressures, or in a manner that no longer sustainable due to either an update in the standard, or derating of equipment due to age and use. So the mega rule aims to getting companies that deal with storing and transporting natural gas through pipelines up to a better operating standard, both for the environment that they are located in and the communities that they are located around.
Jeremy Weisz 3:19
Yeah, I mean, there’s a comprehensive article you have I know on your site, people can check out the eight considerations for PHMSA mega rule compliance, we discussed in detail, a couple of those on a previous episode, which is about who has to follow mega rule compliance? Is your PHMSA plan documented? How to document that and think about documenting that? But today, we’re going to talk more about how does orphan well and mega rule compliance overlap. So maybe we start with I mean, you gave it over the mega rule, maybe talk a little bit about the orphan well?
Brian Chastain 3:53
Yeah, so an orphan well, it’s a well that is no longer being used, right? These are assets that they could be 10 years old, or they could be over 100 years old. People and companies would come through and they would drill wells, and they would get used to throughout their expected lifecycle and whether or not the economy changed the market demand changed, the oil itself stopped producing or in a storage situation, they were no longer using it for that piece. And once it gets, kind of becomes almost obsolete, then they get designated as orphan wells. The problem with orphan wells, is that, as you can imagine, a lot of things have changed over the last 100 years, and or a little bit over 100 years now that people have been drilling for these wells. So what we go through today to properly abandon a well versus what they would do 50 years ago, is night and day. The overlap that we run into now is where you have storage field, you have these operators and some of our key clients who own these wells that have been orphaned or need to be properly abandoned. Maybe in a lot of cases, okay, well, we have 150 wells, and we know that we have them. And we know that we’re not using them. So we need to go in and properly plug and abandon these wells. A lot of people think that a true or orphan well, they might designate that as no records, no anything, you have to physically go search them out and find these wells, due to increasing legislation and regulation. And then-incoming administration changes throughout our government, they have begun designating actual funds through the same groups in the same departments to fund fixing and finding and locating and repairing these orphan wells. And that’s really where it starts to overlap for us. As we’re out doing PHMSA compliance, and wellhead evaluations and site audits for our clients. What we get is an opportunity to discuss orphan wells or soon-to-be abandoned wells. And that’s where we start tying those things in.
Jeremy Weisz 6:42
I’m sure companies, Brian, when you hear government funds, their ears perk up a little bit. Because the current administration announced a plan. I’m not sure what solidified. But I don’t know if you want to talk about what’s in the plan. And how can companies take advantage of that funding?
Brian Chastain 7:06
Yeah, I would love to have a discussion on that. Although, for most documents from the government, it’s a couple of 1000 pages. And so you should probably do your own research when it comes to how to get approved for that. I know that it is being designated on the state level from the federal government. And I know that it was a little over 4 billion, I think it was closer to $5 billion. Totally designated into that structure, a tidbit of information is there’s an estimated 3 million orphaned wells that need to be properly plugged and abandoned, or otherwise repurposed and brought up to date. That’s a lot, right. You start thinking about 3 million wells, it’s estimated right now that less than a million of them actually have even been located properly.
Jeremy Weisz 8:09
And the funds were kind of the part of the administration in support of the global methane pledge.
Brian Chastain 8:19
Yeah, right. I mean, no matter what industry you’re in, everybody really just like, we want a better future for our kids, grandkids, the environment that we currently live in doesn’t matter if you’re young or old or anything. I think that on the most basic level, everyone wants to operate within their industry in a cleaner, more responsible manner. So one of the things that we’re doing is trying to work with companies to show the data of the methane that they could be releasing, or they are releasing. So we not only want to say hey, you’ve got to well that needs to be abandoned, we want to show them the actual data and the information behind that to where any client or potential client then they can see the true benefit to the environment and to their individual ESG pledges that they may have on a corporate level as well.
Jeremy Weisz 9:26
So with this, let’s say there are funds initiated or funds designated for this. The companies would work with possibly getting funds but either way they have to come up with the compliance for these and how does it work when someone calls you.
Brian Chastain 9:48
So I mean, it can work on a various levels. We have done the initial evaluations where we show up and we will do an on-site and walk around with the touch it, feel it, photograph it, document it. And then we go back to our clients. And we really just start to let them know, this is where you stand from our eyes as to any potential PHMSA issues or just more. It’s not even just PHMSA-related. We try to take it from an industry-standard as well. PHMSA is its own piece of the puzzle. And we go in verse say, okay, from this portion of your assets, this is where your PHMSA issues may or may not be from an industry standard, which because we are regulated by DEP and EPA, you can imagine there’s a lot of agencies that scrutinize the energy industry, no matter which side you’re on, even in the renewable space, right, there’s a lot of things you have to do. So we really take the outside-in approach. I think that we’re able to promote a better product at the end for our clients because we are, and I can’t think of the word, we’re not attached to it. We’re indifferent, I guess, right? Yes, exactly. We’re our own independent source. We don’t perform these audits based on if a client is I guess, here’s the nutshell. And I feel like I’m stumbling a little bit. But what it boils down to is we will come do an audit of a client’s facility or their individual assets, with or without the promise of future work. So there is no benefit to us, other than the fact that these facilities are being operated in the same communities in which we live and operate as well. So the only benefit for us is that our client walks away with a better understanding of what they have. And we have done audits where nothing needed to be done. I mean, quite literally, we’ve gone out and some of these companies pass with flying colors. And we’ve gone out to some of them that resulted in an emergency fix, right. So that’s one way that we work with our clients and potential clients through an evaluation step. Another thing that we’ve done is we will actually write up any scope of work for standard operating procedures, and document actual plan of actions. So our engineering and project management team, let’s say, we go out, and we discovered that there’s five things that need to be fixed, for example, well, in order to get the funding that we are speaking of one way that we are aware of is it you have to present a plan of action, you have to present what the impact is going to be to your customers, you have to present what the cost is going to be. And you have to show your kind of expected timeline. So we write a very detailed plan that shows what really everything from day one to day final, what needs to be done in order to get everything up and compliant, that comes with estimated budgets and everything so that our customers are able to take our report, put their stamp and logo on it, and they can physically turn it in from there. So it’s really they sign off on our reporting. They accept it. And that is immediate, and we’ve done that more than once for more than one client. So those are really the two ways that we help our customers get to the next step.
Jeremy Weisz 14:01
Right? I don’t one thing you talk about, Brian is why should someone start this mega rule compliance. And I can see a couple of things. I mean, if there is funding available when there’s funding available, that is also ticking. If all these companies are getting in, then you don’t get it. And also from a staffing and resources perspective, like you mentioned, if there’s 3 million of these just orphan wells, not including all the other stuff that goes on. Talk about that for a second the staffing piece.
Brian Chastain 14:36
Yeah, so I don’t think it’s any news to anyone at this point that our country’s specific is going through a staffing crunch. And no matter what anyone may or may not think is driving that staffing glut right now, what it boils down to is that it is an issue. It is a pain point that our clients have expressed, it is a pain point that our research has shown. And we work diligently with our in-house employees, and with third-party contractors to be able to bridge that gap. And we can bridge it for a week or a month or I mean, we can augment an entire team for five years if they want us to. It’s not to say that we do not go through our own staffing hurdles. But we have a much broader proactive approach, where because we know what is entailed to get sites up and running or back ready, whether or not you wanted to re-commission them, or whatever your next step might be, when we build a plan, that plan says, hey, not only do you have a plan here, but it’s going to require seven individuals or 10 people or three people and one project manager. So we break it down to where they know how much general labor, they’re going to need, how many engineers they would need to expect a project manager, and then we offer a solution to either help them staff it or help them plan for the type of personnel that they may want to hire within. So that’s definitely staffing is a very big concern. I would say that, beyond staffing issues, the other reason why I feel like there are a lot of companies that are in our eyes kind of behind the eight ball when it comes to this. Because like, here’s a good example, I met with a potential client last week, and we had a conversation about permitting. Now they are operating closer to the west coast, the permitting is even harder to come about. So in their instance, and what we were discussing with them, it was up to two years, just to get permitting, to begin a potential project that we were discussing. So now you got two years. Well, you got different pledges by independent, different states every, there’s a bunch of layers, but when you start thinking about this, okay, if this one client has a potential two years lag, just on permitting, and that’s if they had everything today ready to go, right, they already had the plan, they already had the estimated budget and everything else ready to go and they submitted that today. Then the next thing that you’re going to end up with is like, okay, well, we submitted everything. Now we got two years to wait. So you’re already 2024 or further before you can even get your preliminary, okay, nod from the government or your independent agencies to begin it. So our white paper references, dates is 2028 35 2030. All these different dates are thrown out that look like you’ve got 10 plus years. Some of these projects, I mean, we’re in the middle of a five-year project for a client right now. I mean, it’s going to take five years just to get through what they have. And that’s if everything runs ideal. That doesn’t count for emergencies. That doesn’t account for weather delays, permitting issues, budgeting changes, that’s if everything went great. It’s a five-year program, and that’s a pretty small company. So you start thinking of some of the potential clients and our existing clients that are running wells two, three, 4000. That’s not a five-year program. That’s a 15-year program.
Jeremy Weisz 18:58
All of a sudden, it looks like not a lot of time. 10 years. Really quickly.
Brian Chastain 19:04
Jeremy Weisz 19:06
I want to talk about the benefits of PHMSA compliance. I mean, there’s some obvious ones and maybe not so obvious ones. Talk about that.
Brian Chastain 19:16
I would like to point out, I mean, you said it kind of in the intro, right. Our industry has had kind of some shade on it, right, from an environmental standpoint. So one of the big benefits is, we are aiming to decrease potential environmental impacts, right. I use the word mitigate a lot. I don’t work in a world where I think that you can 100% prevent everything, but you can put in so many stop gaps and barriers in place. And I think that at its core, the PHMSA compliance really was aiming to benefit the environment, physical environment, and the community environment. As we talked to a couple episodes back where we were discussing, I mean, non-compliant transmission lines have led to pretty big environmental and health, and safety risks. Our company motto is to start off assessing risks, our program really aims to push that 100%. We want everybody to go home safe. And so I think that the broad picture is to have a safer operation. So that’s really where we focus everything. Of course, as mentioned, we don’t want our clients to make the news. But really, that sounds really good. And at the end of the day, making the news means that something or someone normally got injured, and that’s what we’re aiming for, is a bigger, safer, a long-term solution for our clients.
Jeremy Weisz 21:14
Yeah, I know in the past episode, you talked about some crazy stories. I mean, they’re not so crazy when stuff is not in check. So listen to those episodes. And last thing I want to leave people with mine is just a little bit about Dynamix and how you got into this industry for a second. Dynamix fuel can check it out at dynamixesg.com to learn more. And you can also check for the references article, one of the things we’re talking about eight considerations for the PHMSA mega rule compliance. But just briefly, how’d you get into this industry in the first place?
Brian Chastain 22:01
So me personally, that is probably its own episode. So I am multigenerational within the oil and gas industry. I grew up kind of moving and traveling. But I did not start my career within this industry. The Honest to God story is that I needed a job. And I was looking through Craigslist postings when Craigslist and the Blackberry were just learning things and I’m sitting there with my little BlackBerry scrolling, and I saw an ad posted that said, do you like to travel? Do you like hard work? Would you like to make whatever the dollar amount was and everything? And I was like, man, those all sound great. And so yeah, I went to a group interview in Colorado Springs, Colorado. That’s kind of where I started my big circle. And then from there, I’ve worked all over the country. I’ve been north, south, east, and west, Wyoming, North Dakota for several years, I’ve worked as far north as that can see the border of Canada and as far south as thing the border of Mexico. And really, as I have grown into the industry more and more where I am today is I enjoy working in this industry. But I don’t think that there’s anyone within this industry that can’t acknowledge that there is a better way. So that’s really what I’ve set out to do is try to help companies find that better way. Okay, you’re in the oil and gas industry, you’re in the utility industry, you’re in the electric or the wind farm or solar, whatever it is, there’s always room for improvement. And so that’s why we start off by asking our customers why, and we ask our customers what if, and then we kind of go from there.
Jeremy Weisz 24:20
Love it. Brian. Thank you so much. Everyone, check out more episodes, the podcast, check out dynamixesg.com. And we’ll see you next time. Thanks, Brian.
Brian Chastain 24:30
Yeah, thank you, Jeremy. Have a good day.
Thanks for listening to the Project Dynamix Podcast. We’ll see you again next time and be sure to click subscribe to get future episodes.