(a) 
It shall be unlawful for any person, acting either for himself or as an agent, employee, independent contractor or servant of any other person, to commence to drill, to drill or to operate any well or to assist in the drilling, completing or operating of any such well if a lawful permit therefor has not been obtained. In addition to the other requirements of this division, a new permit is required to reenter any well which has been plugged and abandoned as though the plugged and abandoned well were a new well, and it shall be unlawful for any person, acting either for himself or as an agent, employee, independent contractor or servant of any other person, to reenter such a well without first obtaining a permit therefor. The drilling of a relief well under emergency circumstances arising in connection with an existing well, to correct or safeguard against hazardous conditions, may be commenced without first obtaining a permit. No such well drilled as a relief well shall be completed as a producing well unless a permit therefor shall have been issued in the same manner as is required hereunder for the drilling of any other well, and such well shall be subject to all other applicable provisions of this article. Any relief well not completed as a producing well within six months after commencement of drilling operations, unless an extension is obtained from the city council, shall be plugged and abandoned.
(b) 
Any permit issued for the drilling of a well shall be deemed to cover and include all rights, flowlines, structures and equipment used in drilling, testing and completing such well.
(1999 Code, sec. 114.15)
(a) 
(1) 
No permit shall be issued except upon application by the owner or owners of the property right to which the permit relates. No applicant shall apply for more than one permit and no permit shall cover more than one subject matter. All applications for permits shall be in the form prescribed and shall contain the information and exhibits required by this article. All applications for permits shall be signed and sworn to before a notary public by the applicant or some representative of the applicant having due and legal authority to enter into contracts binding upon the applicant. All applications for permits to drill a well shall be accompanied by a filing fee as set forth in section A4.05.062 of the fee schedule in appendix A to this code.
(2) 
When the city manager finds that the application has been properly submitted and is ready for processing, then the aforementioned filing fees will be deposited to the city’s account. No refund is thereafter available to the applicant except in cases where the permit is denied, in which event an amount as set forth in section A4.05.062 of the fee schedule in appendix A to this code will be retained by the city as a service charge and the balance refunded to the applicant.
(b) 
Every application for a permit required pursuant to this article shall be in writing, signed by the operator or some person duly authorized to sign on his behalf, and it shall be filed with the city secretary. A separate application shall be made for each well to be drilled, redrilled, reworked, converted or activated and shall be accompanied by the applicable processing fee. The application shall include the following information:
(1) 
The date, name and address of the applicant, including, without being limited to, the names and addresses of the manager and person or operator in charge of drilling under and by virtue of the lease.
(2) 
Clear identification of the drilling unit, and the exact location thereon of the proposed well location, on surface and at bottom hole, together with the certified or photostated copies of all requisite permissions, including, if, and then in the manner, required, permission from the owners of the surface and improvements thereon.
(3) 
The name and number of the well and the field name.
(4) 
The names and addresses of all owners of working interest in the well and the names and addresses of all owners, or their representatives, of the land surface that is within 400 feet of the well, except that the distance is reduced to 200 feet for well reentry permits.
(5) 
A plat showing the proposed routes of ingress, egress and regress to the proposed oil operations site together with volumes on such route, and location of all oil facilities on the oil operation site, including, but not limited to, wells, tanks, dikes, pipelines, compressors, separators and storage sheds.
(6) 
The location of the nearest city street, public road or alley; occupied residences and commercial structures within 400 feet of the well; and the location of all churches, hospitals, rest homes, public and parochial schools, preschools, nurseries and places of public assembly within 400 feet of the well.
(7) 
Type of derrick, if any, to be used, including the height thereof.
(8) 
Copies of all permits or authorizations for the particular well granted by other governmental agencies, or applications therefor that are pending.
(9) 
A list of the names and last known addresses of all record owners of interests in and to oil, gas and other minerals under the property included within the drilling unit from which the proposed well is to be produced.
(10) 
A certificate from an insurance company that the applicant has in force insurance complying with the provisions of this article, and a certificate of insurance complying with the provisions of this article.
(11) 
A statement signed by the operator or applicant under penalty of perjury declaring that, if an applicant, he is duly authorized to sign on behalf of the operator and file the application and that the information contained in the application is true and correct.
(12) 
The application shall be accompanied by a cashier’s check payable to the city in the sum as set forth in section A4.05.062 of the fee schedule in appendix A to this code plus an amount determined by the city manager as is necessary to retain the services of a geologist, geophysicist and/or petroleum engineer to study the application for conformity to the highest safety standards in the drilling thereof and for inspection of the well, not only during drilling but upon completion of same, and installation of storage facilities.
(13) 
The agreement by the applicant to pay an annual inspection fee, as set forth in section A4.05.062 of the fee schedule in appendix A to this code, per well each year such well is producing oil and/or gas, which sum shall be payable on the anniversary date of the application.
(14) 
A statement by the applicant relieving the city of any liability for damages which may result from such well or operations pertinent to such well.
(1999 Code, sec. 114.16; Ordinance adopting Code)
(a) 
When the application provided for in this article is filed with the city secretary, the city secretary shall publish a notice in a newspaper within seven days from the date of such application, addressed to “TO ALL INTERESTED PERSONS,” which notice shall state as follows:
This the _____ day of __________, 19 _____, notice is hereby given that acting under and pursuant to the terms and provisions of An Ordinance Regulating the Drilling, Completion and Operation of Oil and/or Gas Wells Within the Limits of the City of Giddings, Texas, dated the _____ day of __________, 19 _____, filed with the City Secretary of the City of Giddings, Texas, a copy of such application is available for public inspection in the office of the City Secretary, Giddings, Texas. A hearing upon such application before the Mayor and the City Council will be held in the Council Chambers of the City of Giddings, Texas, on the _____ day of __________, 19 , at _____ o’clock_____.M.
(b) 
This notice shall bear the signature of the city secretary and the seal of the city. This notice shall be also served by posting one copy thereof on the public bulletin board at the city hall for not less then ten days before the day of hearing therein set forth.
(1999 Code, sec. 114.17)
(a) 
At the time fixed in the notice provided for in this article, a hearing on such application for permit shall be held in accordance with such notice. If a majority of the members of the city council are not present at the hearing, or at the discretion of the members of the city council if a majority of the members thereof are present at the hearing, the hearing may be recessed, continued or postponed from time to time until final disposition of the application. In no event shall final decision on the application be postponed for a longer period than 30 days from the original date of hearing fixed for such application unless a final decision within such time be waived in writing by the applicant.
(b) 
The city council shall have the power to refuse any application for a permit to drill and operate any well at any particular location where, by reason of such particular location and the character and value of the permanent improvements already erected on or approximately adjacent to the particular location in question, and the use to which the land and surroundings are adapted for school, college, university, hospital, park or civic purposes or for health or safety reasons or any of them, the drilling or operation of such well on the particular location might be injurious or a disadvantage to the city or to its inhabitants as a whole, or to a substantial number of its inhabitants or visitors as a group; or the city council may grant a permit, as it may deem necessary, on such reasonable conditions as to protect all persons who, and property which, may be affected by the drilling and production operations.
(1999 Code, sec. 114.18)
(a) 
If, after the hearing provided for in this article, an application filed pursuant to this article is found by the city council to comply in all respects with the terms of this article, and the drilling and operation of a well on such drilling unit is not prohibited by the terms of the article, then the city manager shall issue a permit for the drilling and operation of the well applied for. Each permit issued under this article shall:
(1) 
By reference have incorporated therein all provisions of this article with the same force and effect as if this article were copied verbatim in the permit;
(2) 
Specify the well location with particularity as to lot number, block number, name of addition or subdivision, or the available correct legal description;
(3) 
Contain and specify that the term of such permit shall be for a period of 180 days from the date of the permit and as long thereafter as the permittee is engaged in continuous drilling operations 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 should cease, the term shall not terminate if the permittee commences additional reworking operations within 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 the well;
(4) 
Contain and specify such conditions as are by this article authorized and as required by the geologist, geophysicist and/or petroleum engineer retained by the city to review the application;
(5) 
Specify the total depth to which the well may be drilled, not exceeding the projected depth;
(6) 
Obligate the permittee, in accordance with the leases and contracts held by him and in accordance with this article, to pay to the owners thereof their portion of the royalties and other payments on oil and gas produced from the drilling unit.
(b) 
The permit shall not be issued until the provisions of section 4.05.062(b) are complied with. The permit, in duplicate originals, shall be signed by the city manager and prior to the 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 so signed shall constitute the permittee’s drilling and operating license and the contractual obligation of the permittee to comply with the terms of such permit, and of the certificate of insurance mentioned in this article.
(1999 Code, sec. 114.19)
(a) 
In addition to the fines and penalties provided for in this article, the city manager may in writing suspend or revoke the permit under which a well for oil or gas is being drilled, produced or operated, upon proof and evidence that any provision of this article is being violated after the issuance of the permit by the city manager. Notice of revocation shall be in writing and shall be mailed by registered mail to the permittee’s address shown in his application. Any permittee whose permit or license has been revoked or suspended may, within 15 days from and after the date of the order of revocation or suspension, appeal to the city council from such order.
(b) 
No person shall carry on any operations performed under the terms of any permit during any period of permit suspension or revocation or pending judgment of the court upon any application for writ taken to review the decision or order of the city in suspending or revoking such permit. However, nothing herein contained shall be construed to prevent the performance of such operations as may be necessary in connection with a diligent and bona fide effort to cure and remedy the default or violation for which the suspension or revocation of the permit was ordered, or such operation as necessary for the safety of persons or as required by the commission.
(c) 
In addition to the hearings provided for by this article, any person or entity whose drilling, redrilling, reworking, activating, converting or annual renewal inspection permit is revoked or whose well or equipment is deemed by the city manager to be idle may within 30 days of the decision of the city manager file a written appeal to the city council in accordance with the following procedure:
(1) 
The city council shall have and exercise the power to hear and determine appeals where it is alleged there is error or abuse of discretion regarding the revocation of any permits issued hereunder or determination of the existence of an idle well, as provided by this article.
(2) 
An appeal shall be in writing and shall be filed in triplicate with the city secretary. The grounds for appeal must be set forth specifically, and the error described, by the appellant.
(3) 
Within ten days from and after the filing of the appeal, the city secretary shall transmit to the city council all papers involved in the proceedings and copies of the appeal. In addition, the city secretary shall make and transmit to the city council such supplementary reports as he may deem necessary to present the facts and circumstances of the case. Copies shall be mailed to the appellant ten days prior to the hearing.
(4) 
Upon receipt of the records, the city secretary shall place the matter on the city council agenda for hearing and give notice by mail of the time, place and purpose thereof to the appellant and any other party who has requested in writing to be so notified. No other notice need be given.
(5) 
Upon the date for the hearing, the city council shall hear the appeal unless, for cause, the city council shall on that date continue the matter. No notice on continuance need be given if the order therefor is announced at the time for which the hearing was set.
(1999 Code, sec. 114.20)
(a) 
The holder of any well permit issued hereunder shall obtain and maintain in force a policy or policies of comprehensive general liability insurance, including explosion, collapse, underground and environmental pollution endorsements, or comprehensive well control insurance, issued by a reliable insurance company or companies authorized to do business in the state and having a policyholder rating of “excellent” or better and a financial rating of “BBBB” or better according to the ratings issued by the Best Insurance Guide. The insurance shall provide coverage for the permittee, and the city as an additional named insured, against claims for bodily injury or property damages which might be sustained by any member of the public or by the city by reason of any operations conducted under the well permit, with minimum limits of $1,000,000 for bodily injury per occurrence and in the aggregate, and $1,000,000 property damage per occurrence. The aforesaid limits may be obtained through any combination of specific, excess, or umbrella coverages. All of the policies shall require that the insurers provide the city written notice of cancellation of any such policies no less than 30 days prior to the date of cancellation.
(b) 
In the event such insurance policy or policies are canceled, the permit granted shall terminate on such date of cancellation and the operator’s right to operate under such permit shall cease until the operator files additional insurance as provided herein.
(c) 
In the sole discretion of the city, a permittee may be allowed to operate, but not drill, with the foregoing minimum insurance limits reduced to $500,000 if the permittee substantially meets the following criteria:
(1) 
The permittee has no more than two producing wells under permit from the city.
(2) 
All well and tank battery locations are remote from developed areas.
(3) 
All wells are operating by artificial lift or have a shut-in pressure of 50 pounds per square inch or less.
(4) 
Fences, firewall capacity, and other safety features of all wells are acceptable.
(5) 
The permittee can show that the pumper/gauger can be readily available in cases of emergency.
(d) 
In the event a reduction in the minimum liability limits is granted, all of the other requirements pertaining to the types of insurance coverage and policy provisions described above shall remain applicable.
(1999 Code, sec. 114.21)
In addition to the insurance coverage required in section 4.05.067, a certificate of insurance shall be filed with the city, executed by the permittee as principal and by a corporate surety acceptable to the city as obligee, and conditioned that the principal named in the certificate of insurance shall faithfully comply with all of the provisions of this article and of the permit until the permit shall have been released by the principal and the release shall have been approved by the city as provided herein. For each certificate provided hereunder, documentation of the renewal or substitution of a certificate of insurance shall be received by the city manager no less than ten days prior to expiration of the then current certificate or letter of credit. Such certificate of insurance shall secure the city against all costs, charges and expenses incurred by it by reason of the failure of the principal to fully comply with the provisions of the permit and of this article. The certificate of insurance for any well permit shall be in an amount to be determined by the council from time to time. No permit holder shall be required to post more than a $200,000 certificate of insurance for any number of well permits required by this article.
(1999 Code, sec. 114.22)
(a) 
Permit required.
No person shall activate or put into production any oil well that is an idle well pursuant to this article, or any well whose drill site has been cleaned and restored in accordance with this article, unless an activation permit has been first obtained pursuant to the provisions of this article.
(b) 
Application for permit.
An application shall be filed with the city secretary together with the required permit fee. The application shall include a plot plan and such other information necessary to show that the property and the oil operation will comply with the provisions of this article and this code.
(c) 
Action by city manager.
Within 30 days after such application is filed, the city manager shall review the application. If the city manager finds that activation of the well as requested in the application and the property on which the oil operation is to be located meet all of the requirements of this article, then the city manager shall issue the activation permit. If the city manager is unable to find compliance with the applicable provisions of this article, then he shall deny the permit and shall give notice to the applicant of such denial.
(d) 
Expiration of permit.
Any activation permit issued under the provisions of this article shall expire by limitation and become null and void if the oil operation authorized by such permit is not commenced within 180 days from the date of issuance of such permit.
(e) 
Test permit.
At the request of the applicant and prior to the issuance of the activation permit, the city manager may grant a test permit for a period not to exceed 90 days. This test permit is to authorize the applicant to operate the well on a test basis. The test permit shall not be issued unless the drill site and oil operation are in compliance with all the provisions of this article and other applicable provisions of this Code of Ordinances, except that equipment, materials and operations necessary for the conducting of the test shall be permitted.
(f) 
Cease and desist order.
If, at any time, any operator is in violation of any of the provisions of this article, the city manager may order compliance and set a reasonable period of time for the same. If compliance is not obtained within the time period specified, the city manager shall order, in writing, the operator to cease and desist operation of the well immediately. The operator shall immediately comply with the order of the city manager to cease and desist and shall not resume any operation at the site affected unless and until the written approval of the city manager is obtained.
(g) 
Nonproducing wells.
Whenever any oil well fails to produce at the quarterly rate of 20 barrels of crude oil or other hydrocarbon substances or at a quarterly rate of 100,000 cubic feet of gas for sale, lease or storage for two successive calendar quarters, such well shall be classified as idle.
(1999 Code, sec. 114.23)
Any permit issued hereunder shall be issued over the signature of the city manager or assistant city manager. The permit shall be in duplicate, with one counterpart to be delivered to the permittee after the permittee has executed an acceptance and the other counterpart to be retained by the city manager.
(1999 Code, sec. 114.25)
Any permit except seismic survey permits and test permits shall be termed and referred to as a permanent permit. The term of a permanent permit shall be for a period of days within which to commence work thereunder, and shall continue in force as long thereafter as the use of the facility for which the permit is granted shall not be completely removed or, in the case of a permit to drill a well in search of oil and/or gas, until such time as the well is plugged and abandoned in compliance with the requirements of sections 4.05.104 through 4.05.111 and a release of the permit is issued by the city manager. Upon written application, the city manager may grant one extension of time for cause, not to exceed 90 days, when drilling will not commence within 180 days from the date a permit is issued.
(1999 Code, sec. 114.26)
Any permit issued hereunder may be transferred, provided that the transferee meets all of the requirements of this article, including the posting of the insurance and certificate of insurance required herein. A notice of transfer shall be filed with the city manager, who shall notify the transferor and the transferee whether or not the transferee meets the requirements of this article. The transferor shall nevertheless be liable for all obligations under the permit accruing prior to the effective date of the transfer.
(1999 Code, sec. 114.27)
The issuance of a permit and its acceptance by the permittee shall ipso facto bond and obligate the permittee and his or its executors, administrators, successors and assigns for so long as any drilling, producing, processing, transporting, handling, treating or other operations are being conducted on or with reference to the permitted well or other facility as follows:
(1) 
To maintain in force and effect a policy or policies of liability and property damage insurance with the minimum coverages specified in this article and to furnish annually to the city manager current certificates of insurance and endorsements corresponding to those required herein;
(2) 
To indemnify and save harmless the city, its employees, agents or assigns and to promptly pay on behalf of same all claims, judgments, awards, penalties, fees, costs or expenses including cost of defense for any or all claims of whatever nature arising out of or in connection with the issuance of or work being performed under this permit. Claims include but are not limited to those alleged to have arisen out of personal or bodily injury, property damage, deprivation, inverse condemnation, death or environmental impairment as well as failing in any way to comply with the provisions of this article;
(3) 
To fully comply with all of the terms and requirements of the permit and of this article and all other applicable ordinances of the city, as any of the same may be amended from time to time, and to fully comply with all applicable requirements of federal and state laws and of all federal and state regulatory bodies having jurisdiction;
(4) 
To conduct all operations relative to the purpose for which the permit is obtained with adequate rigs, tools, machinery and equipment, employing recognized procedures in a prudent manner so as to provide maximum protection and safeguards against possible injury to persons or damage to property, public or private;
(5) 
To prevent blowout, cratering, fire, explosions, surface property damage, pollution or contamination of the waters of the city.
(1999 Code, sec. 114.28)
(a) 
The holder of an unexpired and unused drilling permit may, with payment of a service charge as provided in section A4.05.075 of the fee schedule in appendix A to this code, apply for an amended drilling permit for the purpose of changing the surface location.
(b) 
Any holder of a permit may, upon application and without charge, obtain an amended permit from the city manager for the purpose of changing bottomhole location, depth or direction of hole from the same surface location. When the permittee desires to form a production unit as provided for in this division, an amended permit may be secured from the city manager, without any fee, upon application and submittal of the requirements contained in this division.
(1999 Code, sec. 114.29; Ordinance adopting Code)