AB 2729, as it passed the Assembly, commencing January 1, 2018, revised and recast provisions relating to, among other things, filing with the State Oil and Gas Supervisor a blanket indemnity bond in lieu of individual indemnity bonds for each well drilled, redrilled, deepened, or permanently altered, and operators of idle wells not covered under certain indemnity bonds, to, among other things, increase the amounts of the required blanket indemnity bonds, increase the fees required to be filed for each idle well if the operator does not file a plan with the supervisor to provide for the management and elimination of all its long-term idle wells, and eliminate the authorization for an operator to provide an escrow account or indemnity bond for each idle well in lieu of paying a fee or filing a plan.
The Senate amendments revise requirements related to required indemnity bonds and the
plan filed with the supervisor to provide for the management and elimination of all its long-term idle wells, and, until January 1, 2018, remove the requirement that the plan be filed on or before July 1, 1999, require that the plan cover a time period of no more than one year, revise the requirements of the plan, and remove the exemption for operators who comply with the plan from any increased idle well bond or fee requirements.
The Senate amendments also require the supervisor, on or before July 1, 2019, and annually thereafter until July 1, 2026, to prepare and transmit to the Legislature a comprehensive report containing specified information on the status of idle and long-term idle wells for the preceding calendar year. The Senate amendments require the report to be made publicly available and an electronic version to be available on the Internet Web site of the Division of Oil, Gas, and Geothermal Resources in the Department of Conservation, and, after July 1, 2026, require the division to
continue to regularly provide updated information describing idle and long-term idle wells on the division’s Internet Web site.
Vote: 41. Substantial substantive change: yes.