(a)
Lease.
Permittee.
Person.
Well.
For
the purpose of this article and for all purposes under this article,
the following words and terms wherever used or appearing in this article
shall have the scope and meanings hereinafter defined and set out
in connection with each:
Any tract of land subject to any oil, gas and mineral lease
or other oil and gas development contract, or any unit composed of
several tracts and leased but operated as one lease, 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.
The person to whom is issued a permit for the drilling and/or
operation of a well under this article, and his or its administrators,
executors, heirs, successors and assigns.
Includes 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.
Includes and means 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.
(b)
All
technical or oil and gas industry words or phrases used herein and
not specifically defined herein shall have the meanings customarily
attributable thereto by prudent operators in the oil and gas industry.
(1995 Code, sec. 7-1)
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, or to operate,
any well within the city limits 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 in accordance with the terms
of this article.
(1995 Code, sec. 7-2)
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
or alleys of the city, and no street or alley shall be blocked or
encumbered or closed in any drilling or production operation except
by special permit by order of the city council, and then only temporarily.
(1995 Code, sec. 7-3)
No well shall be drilled and no permit shall be issued for any
well to be drilled on any location which is nearer than ninety (90)
feet to any residence or commercial building.
(1995 Code, sec. 7-4)
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 secretary
and be accompanied with a filing fee of $300.00 in cash. An application
shall request a permit to drill and operate only 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.
(5)
Type
of derrick to be used.
(6)
The
proposed depth of the well (which shall not be deeper than 12,000
feet).
(1995 Code, sec. 7-5)
(a)
The city council, within (30) 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 4.02.008 herein and after such determination 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 the provisions of this
article with the 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 cessations
of such operations for more than (90) ninety 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 therein 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
(b)
Said
permit, in duplicate originals, shall be signed by the city secretary
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 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 such bond, and this article.
(c)
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 bond
of the applicant be not approved and the applicant notifies the city
council in writing that he wishes to withdraw his application, then
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 one hundred
dollars ($100.00) as a processing fee.
(1995 Code, sec. 7-6)
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.
(1995 Code, sec. 7-7)
In the event a permit is 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 secretary a bond and a 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, 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, as surety, and with applicant 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 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 secretary 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 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 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.
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 bodily injuries and property damage, naming the permittee and the city, in an insurance company authorized to do business within the state. 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 secretary certificates of
said insurance as above stated and shall obtain the written approval
thereof by the city secretary, 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 secretary
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 permittee’s rights to operate
under said permit shall cease until permittee files additional insurance
as provided herein.
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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:
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|
(A)
|
Bodily injuries, $50,000.00 one person; $100,000.00 one accident;
|
|
(B)
|
Property damage, $50,000.00;
|
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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.
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(1995 Code, sec. 7-8)
The city council shall appoint an oil and gas inspector, and
his compensation shall be set by the city council; 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.
(1995 Code, sec. 7-9)
It shall be unlawful and an offense for any person to drill
a well within the city limits to a true vertical depth in excess of
twelve thousand (12,000) feet, and no drilling and operating permit
shall be granted for any well to a true vertical depth in excess of
twelve thousand (12,000) feet.
(1995 Code, sec. 7-10)
(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 that 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 secretary
specifying:
(1)
The then condition of the well and the casing therein;
(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; and
(4)
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.
(1995 Code, sec. 7-11)
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 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.
(1995 Code, sec. 7-12)
Either earthen or steel slush pits shall be permitted in connection
with the drilling operation. In the event a steel pit is used, said
pit and its contents shall be removed from the premises and the drilling
site within thirty (30) days after completion of the well. In the
event an earthen slush pit is used, same shall be filled and leveled
within one hundred twenty (120) days after completion of the well.
(1995 Code, sec. 7-13)
(a)
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:
|
Depth of String in Feet
|
Internal Pressure Rating
(psi)
|
|---|---|
|
7" casing
| |
|
0'–3,400'
|
2,720 lbs.
|
|
3,400'–4,400'
|
3,740 lbs.
|
|
4,400'–5,850'
|
4,360 lbs.
|
|
5,850'–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.
|
(b)
Each
joint and length of each particular casing string shall have prior
to setting unconditionally passed a complete cold-water test.
(1995 Code, sec. 7-14)
No well shall be drilled within the city limits without properly
setting surface casing to a minimum depth of eight hundred (800) feet.
No well shall be drilled within the city limits without cementing
the surface casing by the pump-and-plug method with sufficient cement
to completely fill all of the annular space behind such casing to
the surface of the ground; and without cementing the production string
by the pump-and-plug method with sufficient cement to completely fill
all the annular space behind the production string to at least 600
feet above the highest oil-and/or gas-bearing horizon; and in the
event a protection string of casing be required under the terms of
this article, without cementing the protection string by the pump-and-plug
method with sufficient cement to completely fill all the annular space
behind the protection string to at least 600 feet above the highest
oil-and/or gas-bearing horizon.
(1995 Code, sec. 7-15)
No well shall be drilled within the city without properly equipping
the surface casing when set with at least one master valve and without
properly equipping the protection casing when set with at least one
master valve and one fluid-operated ram-type blowout preventer. On
each well drilled, a valve cock or kelly cock shall be installed on
the kelly used. Each blowout preventer shall test six thousand (6,000)
pounds, and its mechanical operation shall be tested at least once
every eight-hour period, and all control equipment shall be in good
working condition and order at all times.
(1995 Code, sec. 7-16)
No well shall be drilled within the city limits without using mud as the drilling fluid after the setting of surface casing as provided in section 4.02.015 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 at not less than ten (10) pounds per gallon. 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 will provide a hydrostatic head of not less than five hundred (500) pounds per square inch in excess of the formation pressure. In reworking a well, a drilling fluid shall be at all times maintained at such weight as will provide a hydrostatic head of not less than five hundred (500) pounds per square inch in excess of the formation pressure.
(1995 Code, sec. 7-17)
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 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 the
tool is closed is flushed to the surface by circulating drilling fluid
down the annulus and up the drill pipe.
(1995 Code, sec. 7-18)
All tubing used in any well within the city limits shall be
seamless steel tubing having not less than a minimum internal pressure
yield strength of 5,380 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.
(1995 Code, sec. 7-19)
Each well drilled within the city limits 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 fitting 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.
(1995 Code, sec. 7-20)
(a)
The
Christmas tree and all wellhead connections on each well drilled within
the city limits shall be as follows:
(1)
On all flowing wells completed at a depth of above 4,000 feet, the
Christmas tree and wellhead connections shall have at least a minimum
working pressure of 2,000 pounds per square inch;
(2)
On all wells completed to a depth of from 4,001 to 7,000 feet, the
Christmas tree and wellhead connections shall have at least a minimum
working pressure of 3,000 pounds per square inch and a minimum test
pressure of at least 6,000 pounds per square inch; and
(3)
On all wells completed below a depth of 7,000 feet, the Christmas
tree and wellhead connections shall be at least a minimum working
pressure of 5,000 pounds per square inch and a minimum test pressure
of at least 10,000 pounds per square inch.
(b)
All
piping and fittings connecting the wellhead to an oil-gas separator
shall have at least the same minimum working pressure and minimum
test pressure as hereinabove specified for Christmas tree and wellhead
connections. In the event the surface shut-in pressure of any well
in the city limits exceeds 2,000 pounds per square inch, the flowing
of the Christmas tree shall be equipped with an automatic closing
safety valve in addition to the regular control valves.
(1995 Code, sec. 7-21)
The premises shall be kept in a clean and sanitary condition,
free from rubbish of every character, to the satisfaction of the health
officer, at all times drilling operations or reworking operations
are being conducted and as long thereafter as oil and/or gas is being
produced therefrom.
(1995 Code, sec. 7-22)
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.
(1995 Code, sec. 7-22)
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
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 vaportight 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 vaportight. Each oil-gas separator shall be
equipped with both a regular pressure relief safety valve and a bursting
head.
(1995 Code, sec. 7-24)
It shall be unlawful and an offense for any person to operate
any well as a producer in the city limits unless he encloses said
well, together with its surface facilities, pits and storage tanks,
by a substantial, smooth net-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, person
or his employees are not within the enclosure.
(1995 Code, sec. 7-25)
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 device within the city limits must be done in such manner
so as not to constitute a fire hazard to any property; and the location
of the torch, pipe, or other burning device, the construction thereof,
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.
(1995 Code, sec. 7-26)
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 shall 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 shall be kept filled
to the top with said mud-laden fluid at all times, and mud-laden fluid
of the above specifications shall be left in the well bore below and
between cement plugs. Any additional provisions or precautionary measures
prescribed by the state or the railroad commission of the state in
connection with the abandonment and plugging of a well shall be complied
with by the permittee.
(1995 Code, sec. 7-27)
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 injure surface vegetation.
(1995 Code, sec. 7-28)
Any violation of the laws of the state or any rules, regulations
or requirements of any state or federal regulatory body having jurisdiction
in reference to drilling, completing, equipping, operating, producing,
maintaining, or abandoning an oil or gas well or related appurtenances,
equipment or facilities, or in reference to fire walls, fire protection,
blowout 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 provisions thereof.
(1995 Code, sec. 7-29)
The penalty shall be as provided in section 1.01.009 for violation of this article.
(1995 Code, sec. 7-30)
