HYDRO21518

• Permit No: M1999002
• IBM Index Class Name: Hydrology
• Doc Date: 5/29/1999
• Doc Name: VIC INFO
• Media Type: D
• Archive: No

FINANCIAL ASSURANCE AND ENVIRONMENTAL RESPONSE FUND
9 ~ •
thousand dollars (525,0001•
704. CENTRALIZED E&P WASTE MANAGEMENT FACILITIES
http~,~ww.dnr.state.co. us/oil-gas/RR'7o20ASpsl100series.asp
An operator which makes application for an offsite, centralized E&P waste management facility shall, upon
approval and prior to commencing construction, provide to the Commission financial assurance in the amount
of fifty thousand dollars ($50,000) to ensure the proper reclamation, closure and abandonment of such
facility. This section does not apply to underground injection wells and multi-well pits covered under Rules
706. and 707.
705. SEISMIC OPERATIONS
Any operator submitting a Notice of Intent to Conduct Seismic Operations, Form 20, shall, prior to
commencing such operations, provide financial assurance to the Commission in the amount of twenty five
thousand dollars IS25,0001 statewide blanket financial assurance to ensure the proper plugging and
abandonment of any shot holes and any necessary surface reclamation.
706. SOIL PROTECTION AND PLUGGING AND ABANDONMENT
Prior to commencing the drilling of a well, an operator shall provide financial assurance to the Commission to
ensure the protection of the soil and the proper plugging and abandonment of the well in accordance with the
300 Series of drilling regulations, the 900 Series of E&P waste management, the 1000 Series of reclamation
regulations, and the 1100 Series of flowline regulations. The financial assurance required by this section shall
be in the amount of five thousand dollars (55,000) per well. In lieu of such individual amount, an operator may
submit statewide blanket financial assurance in the amount of thirty thousand dollars (S30,000) for the drilling
and operation of less than one hundred 11001 wells, or one hundred thousand dollars IS100,0001 for the
drilling and operation of one hundred (100) or more wells.
707. INACTIVE WELLS
a. To the extent that an operator's inactive well count exceeds such operator's financial
assurance amount divided by five thousand dollars IS5,0001, such additional wells shall be
considered "excess inactive wells". For each excess inactive well, an operator's required financial
assurance amount under Rule 706. shall be increased by five thousand dollars (55,000). This
requirement shall be modified or waived if the Commission approves a plan submitted by the
operator for reducing such additional financial assurance requirement, for returning wells to
production in a timely manner, or for plugging and abandoning such wells on an acceptable
schedule.
In determining whether such plan is acceptable, the Commission shall take into consideration
such factors as: the number of excess inactive wells; the cost to plug and abandon such wells;
the proportion of such wells to the total number of wells held by the operator; any business
reason the operator may have for shutting-in or temporarily abandoning such wells; the extent to
which such wells may cause or have caused a significant adverse environmental impact; the
financial condition of the operator; the capability of the operator to manage such plan in an
orderly fashion; and the availability of plugging and abandonment services. If an increase in
financial assurance is ordered pursuant to this subsection, the operator may, at its option and in
compliance with these 700 Series rules, submit new financial assurance or supplement its
existing financial assurance.
2 of 4 5!29/99 12:08 PM