In the event a permit is issued by the city council for the
drilling and operation of a well, no actual drilling operations shall
be commenced until the permittee shall file with the city secretary
a bond and a certificate of insurance.
(Ordinance 426, sec. XXXVIII, adopted 9/18/08)
(a) A
bond shall be required in the principal sum of such number of dollars
as has been determined by the city council but not to be less than
twenty-five thousand dollars ($25,000.00) nor more than one million
dollars ($1,000,000.00). Said bond shall be executed by a reliable
surety company authorized to do business in the state as surety and
by the permittee as principal, running to the city for the benefit
of the city and all persons concerned, conditioned that the permittee
will comply with the terms and provisions 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 administrator and
shall remain in full force and effect for at least six (6) months
subsequent to the expiration of the term of the permit issued, and
in addition the bond shall be conditioned that the permittee will
promptly pay off all fines, penalties and other assessments imposed
upon the permittee by reason of breach of any of the terms, provisions
or conditions of this article, and that the permittee will promptly
restore the streets, alleys, sidewalks and other public ways and 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 were first commenced; and that the permittee
will indemnify and hold the city harmless from any and all liability
growing out of or attributable to the granting of such permit. If
at any time the city council shall deem any permittee’s bond
to be insufficient for any reason, it may require the permittee to
file a new bond.
(b) If,
after completion of a well, the permittee has complied with all the
provisions of this article such as removing the derrick, cleaning
the premises, etc., he may apply to the city council to have said
bond reduced to a sum of not less than ten thousand dollars ($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.
(Ordinance 426, sec. XXXIX, adopted 9/18/08)
(a) The
permittee shall carry a policy or policies of standard comprehensive
public liability insurance, including contractual liability covering
bodily injuries and property damage, naming the permittee and the
city, with an insurance company authorized to do business in the state;
said policy or policies in the aggregate shall provide for an umbrella
coverage of at least five million dollars ($5,000,000.00) plus a minimum
of one million dollars ($1,000,000.00) coverage for each accident.
(b) The
permittee shall file with the city administrator certificates of said
insurance and shall obtain the written approval thereof by the city
council, who shall act thereon within ten (10) days from the date
of such filing. Said insurance policy or policies shall not be cancelled
without written notice to the city administrator at least ten (10)
days prior to the effective date of such cancellation. In the event
said insurance policy or policies are cancelled, the permit granted
shall terminate and the permittee’s rights to operate under
said permit shall cease until the permittee files additional insurance
as provided herein.
(c) If,
after completion of a well, the permittee has complied with all the
provisions of this article, such as removing the derrick, clearing
premises, etc., he/she may apply to the city council to have said
insurance policy or policies reduced as follows:
(1) Bodily injury: Five hundred thousand dollars ($500,000.00) one person;
one million dollars ($1,000,000.00) one accident; and
(2) Property damage: One million dollars ($1,000,000.00);
for the remainder of the time said well produces without reworking
operations. During reworking operations, the amount of the insurance
policy or policies shall be increased to the original amounts.
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(Ordinance 426, sec. XXXX, adopted 9/18/08)