R649-9-8. Bonding of Disposal Facilities

1. Disposal facilities, other than injection wells and their associated facilities, shall be bonded according to this rule in order to protect the State and oil and gas producers from unnecessary liabilities and cleanup costs in the future. The objectives are to provide the State with adequate security for site reclamation and post closure cost should a facility owner default.

2. Permits issued after July 1, 2013 for new disposal facilities or modifications and facilities being reviewed for 5-year permit renewals, shall submit site reclamation and post closure cost estimates from a responsible third party contractor for division approval.

2.1. The applicant shall bond in the amount of the approved estimated site reclamation and post closure costs, or $25,000, whichever is greatest.

3. Bonds accepted shall be of the same type as those accepted for wells i.e. surety, collateral, or a combination of the two as described in R649-3-1.

4. The total bond will be held by the division or financial institution until the facility has been closed and inspected by the division in accordance with a division approved closure plan.

5. Bond amounts, for permits approved prior to July 1, 2013 will be calculated as follows, and the per volume or per acre figures may be adjusted periodically to compensate for change in cost to perform the necessary cleanup work:

$14,000 per acre of pit, partial acres will be calculated at the rate of $14,000 per acre; plus

$1.00 per barrel of produced water for one-quarter of the total storage capacity of the facility; plus

$30 per cubic yard of solid or semi-solid waste material stockpiled at the facility.

$10,000 Minimum bond amount.

5.1. Operators of disposal facilities permitted prior to July 1, 2013 shall have until July 1, 2018 (five years) to submit, to the division, a disposal facility site reclamation and post closure bond as required above in R649-9-8.2.

6. All disposal facilities, except injection wells covered by R649-3-1, will be covered by an adequate and acceptable bond before being permitted to accept any E and P waste.

7. Forfeiture of the bond shall be the same as those for wells as described in R649-3-1.16.