New Oil and Gas Well Requirements for 2019
New Mexico recently took steps to further protect the state from harm against well drillers who don’t correctly plug oil and gas wells. When a well isn’t plugged properly, crude petroleum oil, natural gas, or water can escape, causing harm to the environment. An improperly plugged well can also be a fire hazard or cause injury to people and to wildlife.
The amended Oil and Gas Act raises the surety bond amount for single well owners. The higher bond amount guarantees that a well will be plugged responsibly.
Previously, surety bond amounts for one-well plugging were:
- $5,000 plus $1 per well depth for wells located within counties on Form B-1.
- $10,000 plus $1 per well depth for all other wells than those listed on Form B-1.
Starting January 2019, New Mexico Senate Bill 189 removes the bond amount based by counties listed on Form B-1. The surety bond amount has been raised to $25,000 plus $2 per foot of projected depth of the proposed well or depth of existing well.
Surety bond amounts for multiple wells under a blanket surety bond remain the same. Bond amounts are:
- $50,000 for one to ten wells
- $75,000 for 11 to 50 wells
- $125,000 for 51 to 100 wells
- $250,000 for more than 100 wells
The bill also addresses bond amounts for temporarily abandoned wells, which will be greater than $50,000.
Surety bonds are to be filed with the Oil Conservation Division, 1220 South St. Francis Drive, Santa Fe, NM 87505
Where Do I Get a Surety Bond?
SuretyGroup.com writes all surety bonds in all 50 States. Contact us and we’ll get you started right away. Call our Surety Bond Specialists at 844-432-6637 or email firstname.lastname@example.org. We are here to help answer all your questions and issue your surety bond quickly.
What Will a Surety Bond Cost Me?
The premium you pay is dependent on your credit and the number of and depth of wells. Our rates start at 1% of the bond amount with good credit. Our Surety Bond Specialists can give you a free quote that fits your specific situation, with no obligation to buy.
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