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Alabama Submerged Offshore Lands Operation Single Well Surety Bond

offshore drilling

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The State Oil and Gas Board of Alabama, is a regulatory agency that promotes conservation and protection of the environment. The board enforces the state rules and regulations through oversight of oil and gas exploration, drilling, operation, and production, Class II injection wells, and underground storage of gas in reservoirs in Alabama.

The Oil and Gas Board of Alabama Administrative Code 400-1-1-.01 thru 400-7-1-.23 defines the regulations process for oil and gas permits. The following is required for the Submerged Offshore Lands Operations permit for the purpose of commencement of “drilling, competing, converting, operating, or producing any oil, gas, or Class II injection well, including production facilities, processing facilities, injection facilities, underground storage facilities in reservoirs, offshore plants, pipelines, and other equipment associated with such well “(400-2-2-.03)

Surety Bond Requirements:

Obtain a surety bond in the amount as follows for single wells:
Measured Depth 1-6,000 feet = $100,000 surety bond
Measured Depth greater than 6,000 feet = $500,000 surety bond

Single Well Permit Requirements

  1. Complete the permit application and pay the permit fee.
  2. Submit with the permit application a “Certified Plat” (in triplicate). The certified plat must meet the conditions and requirements for the applicable operation (offshore, onshore, CBM, etc).
  3. Complete an affidavit of ownership or control (Form OGB-2).
  4. Complete an organization report (Form OGB-5).
  5. Provide a statement that any zone that contains oil, gas, or freshwater will be fully protected by casing and cement.
  6. Provide 2 copies of each of the following:
  7. a. Casing cement down hole schematics
    b. Mud
    c. Blowout prevention
    d. Drill rig specifications
    e. Listing of drilling problems
    f. Report of shallow hazards
    g. Certificate of compliance
    h. Area contingency spill plan
    i. Deepening or directional drilling

How Much Will an Alabama Offshore Lands Single Well Bond Cost?

The premium that you pay for an Alabama Submerged Offshore Lands Operations Permit Single Well Surety Bond is dependent on credit, personal and business financial statements, and the bond amount required.

Did You Know?

Alabama has some of the most stringent environmental regulations for offshore drilling.

Related Links:

Alabama Oil and Gas Industry Information
Alabama Oil and Gas Board Administrative Code
Alabama Submerged Lands Act

More Surety Bond Questions?

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