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Is a Bond Required for an Alabama Underground Storage of Gas in Reservoirs?

Drilling for Natural Gas

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 underground storage of gas in reservoirs permit for the purpose of commencement of “operation of any underground storage facility for solution-mined cavity and storage well “(400-6-3-.01):

1. Completion of the permit application (OGB-1D).
2. Submit a plat (in triplicate) of the proposed underground storage well.
3. Submit a copy of your surface injection system schematic diagram.
4. Submit a copy of a wellbore sketch.
5. Submit a casing test result.
6. Provide proof of an adequately cemented long string of casing (reservoir storage).
7. Provide an annotated electric log through injection zone.
8. Provide an affidavit of specifying source of fluids.
9. Provide an analysis of fluids to be injected in the injection zone.
10. Provide a statement of the proposed treatment of the injected fluids prior to injection.
11. Other forms and documents may be required.
12. Complete an organization report (Form OG-5).
13. A $100,000 surety bond is required for the permit. The original bond must be signed by each authorized owner, individual, partner or officers and submitted to the board.

How Much Does This Bond Cost?

The premium that you pay for an Alabama Underground Storage of Gas in Reservoirs Bond is dependent on credit, personal and business financial statements.

Did You Know?

Global underground gas storage is expected to increase by more than 200 billion cubic meters by 2030 from the current day storage of approximately 377 billion cubic meters.

Related Links:

Alabama State Oil and Gas Board - Administrative Code
The Basics of Underground Natural Gas Storage

How Do I Get Bonded?

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