For the purpose of this article, and for all purposes under this article, the following words and terms wherever and whenever used or appearing in this article shall have the scope and meaning hereinafter defined and set out in connection with each:
Person.
Shall include both the singular and the plural; and shall mean and include any person, individual, firm, partnership, association, corporation, club society, cooperative, trust, municipal corporation or political subdivision whatsoever.
Well.
Shall include and mean any hole or holes, bore or bores, to any sand, formation, strata or depth for the purpose of producing and recovering any oil, gas, liquid hydrocarbon, or any of them.
Permittee.
Shall mean the person to whom is issued a permit for the drilling and operation of a well under this article, and his or its administrators, executors, heirs, successors and assigns. All technical or oil and gas industry words or phrases used herein and not specifically defined herein shall have that meaning customarily attributable thereto by prudent operators in the oil and gas industry.
Lease.
Shall mean a tract of land subject to an oil, gas and mineral lease or other oil and gas development contract, or any composed of several tracts and leases but operated as one lease, and any tract of land in which the minerals are owned by an operator or someone holding under it or him, but which, due to the fee royalty ownership is developed and operated as a separate tract.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-1)
It shall be unlawful and an offense for any person acting either for himself or acting as agent, employee, independent contractor, or servant of any other person, to commence to drill, to drill, or to operate, any well within the city limits of the City of Sundown or to work upon or assist in any way in the prosecution or operation of any such well, without a permit for the drilling and operation of such well having first been issued by the authority of the city council of the City of Sundown, in accordance with the terms of this article.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-2)
No well shall be drilled and no permit shall be issued for any well to be drilled at any location which is within any of the streets and alleys of the City of Sundown; and no street or alley shall be blocked or encumbered or closed in any drilling or production operation except by special permits by the order of the city council of the City of Sundown, and then only temporarily.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-3)
(a) 
No well shall be drilled and no permit shall be issued for any well to be drilled at any location which is nearer than 150 feet of any surface owner, without the applicant having first secured the duly acknowledged, written permission of the owner(s) thereof.
(b) 
No residential or commercial building, or other improvement, except a fence shall be constructed, remodeled, placed or otherwise located within 150 feet of any existing or permitted well location.
(c) 
All residential or commercial buildings, which are located within 150 feet of an existing oil well as of the effective date of this article, shall be exempted from this article.
(Ordinance 324 adopted 10/15/90; Ordinance 375 adopted 6/20/00)
Every application for a permit to drill and operate a well shall be in writing, signed by the applicant or by some person duly authorized to sign same on his behalf, and it shall be filed with the city clerk and accompanied with a filing fee as provided for in the fee schedule found in the appendix of this code. No application shall request a permit to drill and operate but one well, the said application shall include full information, including the following:
(1) 
the date of said application;
(2) 
name of the applicant;
(3) 
address of the applicant;
(4) 
proposed site of the well, including;
(A) 
name of the fee owner
(B) 
name of the lease owner
(C) 
brief description of the land
(5) 
type of derrick to be used;
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-5)
The city council, within twenty (20) days after the filing of the application for a permit to drill and operate a well shall determine whether or not said application complies in all respects with the provisions of this article, and if it does, the city council shall then fix the amount of the principal of the bond and insurance provided for in Section 4.308 herein, and after such determination shall issue a permit for drilling and operation of the well applied for. Each permit issued under this article shall:
(1) 
By reference have incorporated therein all the provisions of this article with same force and effect as if this article were copied verbatim in said permit;
(2) 
Specify the well location with particularity to lot number, block number, name of addition or subdivision, or other available correct legal description;
(3) 
Contain and specify that the term of such permit shall be for a period of one year from the date of the permit and as long thereafter as the permittee is engaged in drilling operations with no cessation of such operations for more than ninety (90) days, or oil or gas is produced in commercial quantities from the well drilled pursuant to such permit, provided that if at any time after discovery of oil or gas the production thereof in commercial quantities shall cease, the term shall not terminate if the permittee commences additional reworking operations within ninety (90) days thereafter, and if they result in the production of oil or gas, so long thereafter as oil or gas is produced in commercial quantities from said well;
(4) 
Contain and specify such conditions as are by this article authorized;
(5) 
Specify the total depth to which the well may be drilled not exceeding the projected depth; and,
(6) 
Contain and specify that no actual operations shall be commenced until the permittee shall file and have approved an indemnity bond in the designated principal amount as so determined by the city council and conditioned as specified in Section 4.308 hereof;
Said permit in duplicate originals, shall be signed by the city clerk of the City of Sundown, and prior to delivery to the permittee shall be signed by the permittee (with one original to be retained by the city and one by the permittee); and when signed shall constitute the permittee’s drilling operating license and the contractual obligation of the permittee to comply with the terms of such permit and such bond, and this article.
If the permit for the well be refused, or if the applicant notifies the city council in writing that he does not elect to accept the permit as tendered and wishes to withdraw his application, or if the city council in writing that he wishes to withdraw his application, when upon the happening of said events the cash deposit provided for to be filed with the application shall be returned to the applicant, except that there shall be retained therefrom by the City of Sundown, a processing fee as provided for in the fee schedule found in the appendix of this code.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-6)
When a permit shall have been issued, the same shall terminate and become inoperative without any action on the part of the city unless within ninety (90) days from the date of issuance actual drilling of the well shall have commenced. The cessation for a like period of the drilling operations or the cessation of the production of oil or gas from the well after production shall have commenced shall operate to terminate and cancel the permit, and the well shall be considered as abandoned for all purposes of this article, and it shall be unlawful thereafter to continue the operation or drilling of such well without the issuance of another permit.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-7)
In the event a permit be issued by the city council under the terms of this article for the drilling and operation of a well, no actual drilling operations shall be commenced until the permittee shall file with the city clerk of the City of Sundown, a bond and certificate of insurance, as follows:
(1) 
A bond in the principal sum of such number of dollars as has been so determined by the city council of the City of Sundown, but not to be less than $25,000.00. Said bond to be executed by a reliable insurance company authorized to do business in the State of Texas, as surety, and with applicant as principal, running to the City of Sundown for the benefit of the city and all persons concerned conditioned that the permittee will comply with the terms and conditions of this article in the drilling and operation of the well. Said bond shall become effective on or before the date the same is filed with the city clerk and remain in force and effect for at least a period of six (6) months subsequent to the expiration of the term of the permit issued, and in addition, the bond will be conditioned that the permittee will promptly pay off fines, penalties and other assessments imposed upon permittee by reason of his breach of any of the terms, provisions and conditions of this article, and that the permittee will promptly restore the streets and sidewalks and other public property of the city, which may be disturbed or damaged in the operations, to their former condition; and that the permittee will promptly clear all premises of all litter, trash, waste, and other substances used, allowed, or occurring in the drilling or producing operations, and will, after abandonment, grade, level and restore said property to the same surface condition, as nearly as possible, as existed when operations for the drilling of the well or wells were first commenced; and that the permittee will indemnify and hold the City of Sundown harmless from any and all liability growing out of or attributable to the granting of such permit. If at any time the city council of the City of Sundown shall deem any permittee’s bond to be insufficient for any reason, it may require the permittee to file a new bond.
If, after completion of a well permittee has complied with all of the provisions of this article, such as to removing derrick, clearing premises, etc., he may apply to the city council to have said bond reduced to a sum of not less than $10,000.00 for the remainder of the time said well produces without reworking. During reworking operations the amount of the bond shall be increased to the original amount.
(2) 
In addition to the bond required in subsection (1) of this section, the permittee shall carry a policy or policies of standard comprehensive public liability insurance, including contractual liability covering the bodily injuries and property damage, naming the permittee and the City of Sundown, in an insurance company authorized to do business within the State of Texas, said policy or policies in the aggregate shall provide for the following minimum coverages:
(A) 
Bodily injuries $100,000.00 one person $300,000.00 one accident;
(B) 
Property damage $200,000.00.
Permittee shall file with the city clerk of the City of Sundown, certificates of said insurance as above stated, and shall obtain the written approval thereof by the city clerk of the City of Sundown who shall act thereon within ten (10) days from the date of such filing. Said insurance policy or policies shall not be canceled without written notice to the city clerk of the City of Sundown, at least ten (10) days prior to the effective date of such cancellation. In the event said insurance policy or policies are canceled, the permit granted shall terminate, and permittee’s files additional insurance as provided herein.
If, after completion of a well permittee has complied with all of the provisions of this article, such as to removing derrick, clearing premises, etc., he may apply to the city council to have said insurance policies reduced as follows:
(A)
Bodily injuries $50,000.00
 
$100,000.00 one accident;
(B)
Property damage $50,000.00
for the remainder of the time said well produces without reworking. During reworking operations the amount of the insurance policy or policies shall be increased to the original amount.
(3) 
The city council may elect to make an exception to the requirements of (1) and (2) of this section when in their opinion the intent and purpose for the requirements of the bond and insurance can be assured by any of the following means:
(A) 
Acceptance of a guaranty of indemnity to the city in lieu of bond and a plan of self insurance in the case of financially responsible operators.
(B) 
Acceptance of a blanket bond and a single policy of insurance to cover all operations of the permittee within the city limits.
(C) 
Application of bond and insurance requirements acceptable to the city council.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-8)
The city council shall appoint an oil and gas inspector, and his compensation shall be set by the city council; and said Inspector may be removed at the will of said city council. It shall be the duty of the oil and gas inspector to enforce the provisions of this article.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-9)
(a) 
Once any well has either been completed as a producer or abandoned as a dry hole, it shall be unlawful and an offense for any person to drill such well to a deeper depth than was reached in the prior drilling operations without the permittee as to such well obtaining a supplemental permit after filing a supplemental application with the city clerk specifying:
(1) 
The then condition of the well and the casing thereon;
(2) 
The depth to which it is proposed such well be deepened, not to exceed in any event a total true vertical depth from the surface in excess of twelve thousand (12,000) feet;
(3) 
The proposed casing program to be used in connection with proposed deepening operations;
(4) 
And evidence of adequate current tests showing that the casing strings in said well currently pass the same tests as are in this article provided for in case of the drilling of the original well.
(b) 
In the event the city council is satisfied that said well may be deepened with the same degree of safety as existed in the original well, a supplemental permit may be issued without additional filing fee to the permittee authorizing the deepening and operation of the well to such specified depth as applied for, not exceeding in any event a total true vertical depth from the surface in excess of twelve thousand (12,000) feet. In any deeper drilling or any deeper completion or any deeper production operations the permittee shall comply with all other provisions contained in this article and applicable to the drilling, completion and operation of a well or wells.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-10)
It shall be unlawful and an offense for any person to use or operate in connection with the drilling or reworking of any well within the City Limits of Sundown, any wooden derrick or any steam-powered rig, and all engines shall be equipped with adequate mufflers approved by the oil and gas inspector; or to permit any drilling rig or derrick to remain on the premises or drilling site for a period longer than sixty (60) days after completion or abandonment of the well. At all times from the start of erection of a derrick, or a mast, or a gin-pole, until the well is abandoned and plugged or completed as a producer and enclosed with a fence as herein provided, the permittee shall keep a watchman on duty on the premises at all times; provided, however, it shall not be necessary to keep an extra watchman on duty on the premises when other workmen of permittee are on said premises.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-11)
Steel slush pits shall be used with the drilling operation. Said steel pits and its contents shall be removed from the premises and the drilling site within thirty (30) days after completion of the drilling of the well. Earthen pits will be approved by the city council on a case by case basis. When approved, the earthen pits must be filled and leveled within one hundred twenty (120) days after completion of the well.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-12)
All casing, including surface protection and production strings shall be either seamless steel or equivalent quality oil well casing. Each production string of casing must comply with at least the following minimum internal pressure yield strength, computed in accordance with A.P.I. Standards, to wit:
Depth of String
(ft)
Internal Pressure Rating
(psi)
7" Casing
0' - 3,400'
2,720 lbs.
3,400' - 4,400'
3,720 lbs.
4,400' - 5,580'
4,360 lbs.
5,580' - 7,650'
6,340 lbs.
7,650' - 9,450'
7,240 lbs.
9,450' - 11,300'
8,160 lbs.
5 1/2" Casing
0' - 4,400'
3,110 lbs.
4,400' - 5,600'
4,270 lbs.
5,600' - 6,900'
4,810 lbs.
6,900' - 8,000'
5,320 lbs.
8,000' - 10,005'
7,740 lbs
Each joint and length of each particular casing string shall have prior to setting unconditionally passed a complete cold water test.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-13)
No well shall be drilled within the City Limits of Sundown without properly setting and cementing surface casing to a minimum depth of four hundred twenty-five (425) feet unless the Water Quality Board of the State of Texas requires that the surface casing be set and cemented at a greater depth, in which event, such casing shall be set and cemented at the depth set by the Water Quality Board.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-14)
No well shall be drilled within the City Limits of Sundown without properly equipping the surface casing when set with a proper valve or valves as might be required by the Texas Railroad Commission and without properly equipping the protection casing when set with at least one master valve and fluid operated run type blowout preventor, as may be required by the Texas Railroad Commission.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-15)
No well shall be drilled within the City Limits of Sundown without using mud as the drilling fluid after the setting of surface casing as provided in Section 4.315 hereof. Prior to the time the well reaches a total depth of 5,000 feet or the depth of the first known or encountered oil or gas bearing horizon, whichever is the lesser depth, the weight of the mud laden drilling fluid shall be at all times maintained as required by the rules and regulations of the Railroad Commission of the State of Texas. After the well reaches a total depth of 5,000 feet or the depth of the first known or encountered oil or gas bearing horizon, whichever is the lesser depth, the weight of the mud laden drilling fluid shall be at all times maintained at such weight as may be required by the rules and regulations of the Texas Railroad Commission.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-16)
It shall be unlawful and an offense for any person in connection with the drilling or reworking operations of any well within the City Limits of Sundown to take and to complete any drill stem test or tests except during daylight hours and then only if the well effluent during the test is produced through an adequate oil and gas separator to storage tanks, and the effluent remaining in the drill pipe at the time of the tool is closed is flushed to the surface by circulating drilling fluid down the annulus and up the drill pipe.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-17)
All tubing used in any well within the city limits of the City of Sundown shall be seamless steel tubing having not less than a minimum internal pressure applied strength of 5,280 pounds per square inch if used in connection with a well completion at a depth not exceeding 7,000 feet, or less than a minimum internal pressure yield strength of 7,260 pounds per square inch if used in connection with a well completion at a depth in excess of 7,000 feet.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-18)
Each well drilled within the City Limits of Sundown shall be equipped with a bradenhead with a working pressure of not less than 3,000 pounds per square inch. Bradenheads shall not be welded. The bradenhead installed on the surface casing shall be set above ground level and shall be equipped with filling having a working pressure rating of not less than 3,000 pounds per square inch. The bradenhead pressure shall be checked at least once each calendar month and if pressure is found to exist, proper remedial measures shall be immediately taken to eliminate the source and the existence of the pressure.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-19)
The Christmas tree and all well head connections on each well drilled within the City Limits of Sundown shall be in conformity with the rules and regulations of the Texas Railroad Commission.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-20)
The premises shall be kept in a clean and sanitary condition, free from rubbish of every character, to the satisfaction of the Health Officer of the City of Sundown, at all times drilling operations or reworking operations are being conducted, and as long thereafter as oil and/or gas is being produced there from.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-21)
Motive power for all operations after completion of drilling operations shall be electricity or properly muffled gas, gasoline or diesel engines; such mufflers to be approved by the oil and gas inspector prior to their use.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-22)
It shall be unlawful and an offense for any person to use, construct or operate in connection with any producing well within the City Limits of Sundown any crude oil storage tanks except to the extent of two steel tanks for oil storage, not exceeding 500 barrels capacity each and so constructed and maintained as to be vapor tight and each surrounded with an earthen fire wall at such distance from the tanks as will under any circumstances hold and retain at least one and one-half times the maximum capacity of such tank. A permittee may use, construct and operate a steel conventional separator, and such other steel tanks and appurtenances as are necessary for treating oil, with each of such facilities to be so constructed and maintained as to be vapor tight. Each oil gas separator shall be equipped with both a regulation pressure relief safety valve an a bursting head.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-23)
Any person who completes a well as a producer shall have the obligation to enclose said well, together with its surface facilities and storage tanks, by a substantial smooth new wire fence sufficiently high and properly built so as to ordinarily keep persons and animals out of the enclosure with all gates thereto to be kept locked when the permittee or his employees are not within the enclosure. It is provided, however, that in non-congested areas the oil and gas inspector, in his discretion, may waive the requirement of any fence or may designate the type of fence to be erected.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-24)
No person engaged in drilling or operating any well shall permit gas to escape or be vented into the air unless said gas be flared and burned. All gas flared or burned from a torch, pipe, or any other burning devise, within the City Limits of Sundown must be done in such manner so as not to constitute a fire hazard to any property; and the location of the maintenance thereof, and the operation thereof, shall at all times be in full compliance with such regulations as may from time to time be issued by the oil and gas inspector of the City of Sundown.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-25)
Whenever any well is abandoned it shall be the obligation of the permittee and the operator of the well to set a 200 foot cement plug in the bottom of the surface casing with the bottom of the plug 100 feet below the surface casing section, and the top of the plug 100 feet above the surface casing section; and to set a 50 foot cement plug in the top of the surface casing. No surface or conductor string of casing may be pulled or removed from a well. During initial abandonment operations it will be the obligation of the permittee and the operator of the well to flood the well with mud laden fluid weighing not less than ten (10) pounds per gallon, and the well will be kept filled to the top with said mud-laden fluid at all times; mud-laden fluid of the above specifications will be left in the well bore below and between cement plugs. Any additional provisions or precautionary measures prescribed by the State of Texas or the Railroad Commission of the State of Texas in connection with the abandonment and plugging of a well shall be complied with by the permittee.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-26)
Permittee shall make adequate provisions for the disposal of all salt water or other impurities which he may bring to the surface, such disposal to be made in such manner as to not contaminate the water supply, present or prospective, or to inure surface vegetation.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-27)
Any violation of the laws of the State of Texas or any rules, regulations or requirements of any State or Federal regulatory body having jurisdiction in reference to drilling, completing operating, producing, maintaining, or abandoning an oil or gas well or related appurtenances, equipment or facilities, or in reference to fire walls, fire protection, blow-out protection, safety protection or convenience of persons or property, shall also be a violation of this article and shall be punishable in accordance with the provision hereof.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-28)
It shall be unlawful and an offense for any person to violate or neglect to comply with any provision hereof irrespective of whether or not the verbage of each section hereof contains the specific language that such violation or neglect is unlawful and is an offense. Any person who shall violate any of the provisions of this article, or any of the provisions of a drilling and operating permit issued pursuant hereto, or any condition of the bond filed by the permittee pursuant to this article or who shall neglect to comply with the terms hereof, shall be deemed guilty of a misdemeanor, and shall, on conviction thereof, be fined in accordance with the general penalty provision found in Section 1.109 of this code, and the violation of each separate provision of this article, and of said permit, and of said bond, shall be considered a separate offense, and each days violation of each separate provision thereof shall be considered a separate offense. In addition to the foregoing penalties, it is further provided that the city council of the City of Sundown at any regular or special session or meeting, revoke or suspend any permit issued under this article and under which drilling or producing operations are being conducted in the event the permittee thereof has violated any provision of said permit, said bond, or this article. In the event the permit be revoked, the permittee may make application to the city council of the City of Sundown, for a re-issuance of such permit, and the action of the city council hereon shall be final.
(1986 Municipal Code, Title 4, Chapter 5, Section 4-5-29)