Cal. Pub. Res. Code § 3206
Regulation of Operations
Redline — January 1, 2011 → current.View current text →
Current — January 1, 2025
As of January 1, 2011
(a) The operator of any idle well not covered by an indemnity bond provided under Section 3204, subdivision (c) of Section 3205, or subdivision (a) of Section 3205.2 shall do one of the following: (1) File with the supervisor an annual fee for each idle well equal to the sum of the following amounts: (A) One hundred dollars ($100) for each idle well that has been idle for less than 10 years. (B) Two hundred fifty dollars ($250) for each idle well that has been idle for 10 years or longer, but less than 15 years. (C) Five hundred dollars ($500) for each idle well that has been idle for 15 years or longer. (2) Provide an escrow account in a federally insured bank that does business in, and has an office in, the State of California, by depositing the amount of five thousand dollars ($5,000) for each idle well, in the following manner: (A) The escrow account shall be accessible only by the supervisor and the money shall be retained in the escrow account exclusively for use by the supervisor for plugging and abandoning the operator’s idle wells that become deserted pursuant to Section 3237. (B) The money in the escrow account may be released only by the supervisor and only in amounts covering any idle well that has properly been plugged and abandoned, returned to production or injection or converted to an active observation well, if that money remaining in the escrow account is sufficient to fully fund the required deposits for all of the operator’s remaining idle wells. (C) The required deposit for each idle well shall be funded completely within 10 years of the date the well becomes idle, or 10 years from January 1, 1999, for any well that is idle as of January 1, 1999. (D) The operator shall fund the escrow account at the rate of at least five hundred dollars ($500) per well per year. (E) Failure of an operator in any year to provide the minimum funding for any idle well shall result in the institution of the annual fees required by paragraph (1) for that idle well, and all money already on deposit for that idle well shall be treated as previously paid annual fees and shall be deposited into the Hazardous and Idle-Deserted Well Abatement Fund specified in subdivision (b) for expenditure pursuant to that subdivision. (3) File with the supervisor an indemnity bond that provides the sum of five thousand dollars ($5,000) for each idle well. The bond shall be subject to the conditions provided in Section 3204. (4) On or before July 1, 1999, file a plan with the supervisor to provide for the management and elimination of all long-term idle wells not covered under paragraph (1), (2), or (3). (A) For the purposes of the plan required by this paragraph, elimination of an idle well shall be accomplished when the well meets the requirements of Section 3208. (B) A plan filed pursuant to this paragraph shall meet all of the following requirements and conditions: (i) The plan shall cover a time period of no more than 10 years and may be renewed annually thereafter, subject to approval by the supervisor. (ii) The plan shall be reviewed for performance annually by the supervisor, and be subject to amendment with the approval of the supervisor. (iii) The required rate of long-term idle well elimination shall be based upon the number of idle wells under the control of an operator on January 1 of each year, as specified in clause IV. The supervisor may require additional well testing requirements as part of the plan. (iv) The plan shall require that operators with 10 or fewer idle wells eliminate at least one long-term idle well every two years; operators with 11 to 20, inclusive, idle wells eliminate at least one long-term idle well each year; operators with 21 to 50, inclusive, idle wells eliminate at least two long-term idle wells each year; operators with 51 to 100, inclusive, idle wells eliminate at least five long-term idle wells each year; operators with 101 to 250, inclusive, idle wells eliminate at least 10 long-term wells each year; and operators with more than 250 idle wells eliminate at least 4 percent of their long-term idle wells each year. (v) An operator who complies with the plan is exempt from any increased idle well bond or fee requirements. (vi) An operator who fails to comply with the plan, as determined by the supervisor after the annual performance review, is not eligible to use the requirements of this paragraph, for purposes of compliance with this section, for any of its idle wells. That operator shall immediately provide one of the alternatives in paragraph (1), (2), or (3) for its idle wells and may not propose a new idle well plan for the next five years. An operator may appeal to the director pursuant to Article 6 (commencing with Section 3350) regarding the supervisor’s rejection of a plan and plan amendments and the supervisor’s determinations of the operator’s failure to comply with a plan.
(a) No later than May 1 of each year, the operator of any idle well shall do either of the following: (1) For each idle well that was an idle well at any time in the last calendar year, file with the supervisor an annual fee equal to the sum of the following amounts: (A) One thousand dollars ($1,000) for each idle well that has been an idle well for less than three years. (B) Two thousand five hundred dollars ($2,500) for each idle well that has been an idle well for three years or longer, but less than eight years. (C) Five thousand dollars ($5,000) for each idle well that has been an idle well for 8 years or longer, but less than 15 years. (D) Twelve thousand five hundred dollars ($12,500) for each idle well that has been an idle well 15 years or longer, but less than 20 years. (E) (i) Until January 1, 2029, twenty-two thousand five hundred dollars ($22,500) for each idle well that has been an idle well for 20 years or longer. (ii) On and after January 1, 2029, twenty-two thousand five hundred dollars ($22,500) for each idle well that has been an idle well for 20 years or longer, but less than 25 years. (F) On and after January 1, 2029, sixty thousand dollars ($60,000) for each idle well that has been an idle well for 25 years or longer. (2) File a plan with the supervisor to provide for the management and elimination of all idle wells. For purposes of the plan, elimination of an idle well shall be accomplished when the well has been properly abandoned in accordance with Section 3208, or it has been shown to the division’s satisfaction that, since the well became an idle well, the well has maintained production of oil or gas, maintained production of water used in production stimulation, or been used for enhanced oil recovery, reservoir pressure management, or injection for a continuous six-month period. The plan shall comply with all of the following: (A) Specify the calendar year or years that it covers. The plan and any renewal of the plan shall cover a time period of up to eight years. (B) Require the operator to consider all of the following when prioritizing idle wells for plugging and abandonment, in addition to priorities identified by the supervisor in regulations: (i) The age of the idle well. (ii) Any indication that the idle well potentially poses a threat to life, health, property, or natural resources. (iii) Wells that are located within 3,200 feet of a sensitive receptor, as defined in Section 3280. (C) Include notes indicating the basis for prioritizing wells. (D) Be subject to approval by the supervisor, who may prioritize the order in which idle wells are addressed. (E) Be reviewed for performance annually by the supervisor, and be subject to amendment by the supervisor, or by the operator with the approval of the supervisor. An updated plan shall be required if there is a change in ownership or holdings of the operator. (F) The required rate of idle well elimination shall be based upon the number of idle wells under the control of an operator on January 1 of each year, as specified in subparagraph (G). If the operator has eliminated more wells than required in calendar year 2024 or any subsequent calendar year, the supervisor may deduct from the new requirement the number of idle wells eliminated in excess of those previously required. In addition, the supervisor may require additional well testing requirements as part of the plan. (G) (i) For calendar years 2025 to 2027, inclusive, unless and until the operator has no idle wells, require that operators with 250 or fewer idle wells eliminate at least 5 percent of their idle wells each year, and, in no case, less than 1 idle well; operators with 251 to 1,250, inclusive, idle wells eliminate at least 6 percent of their idle wells each year; operators with 1,251 to 3,000, inclusive, idle wells eliminate at least 7 percent of their idle wells each year; and operators with more than 3,000 idle wells eliminate at least 15 percent of their idle wells each year. (ii) For calendar years 2028 and 2029, unless and until the operator has no idle wells, require that operators with 250 or fewer idle wells eliminate at least 6 percent of their idle wells each year, and, in no case, less than 1 idle well; operators with 251 to 1,250, inclusive, idle wells eliminate at least 8 percent of their idle wells each year; operators with 1,251 to 3,000, inclusive, idle wells eliminate at least 10 percent of their idle wells each year; and operators with more than 3,000 idle wells eliminate at least 18 percent of their idle wells each year. (iii) For calendar year 2030 and all subsequent calendar years, unless and until the operator has no idle wells, require that operators with 250 or fewer idle wells eliminate at least 8 percent of their idle wells each year, and, in no case, less than 1 idle well; operators with 251 to 1,250, inclusive, idle wells eliminate at least 10 percent of their idle wells each year; operators with 1,251 to 3,000, inclusive, idle wells eliminate at least 15 percent of their idle wells each year; and operators with more than 3,000 idle wells eliminate at least 20 percent of their idle wells each year. (H) An operator who fails to comply with the plan, as determined by the supervisor after the annual performance review, is not eligible to use the requirements of this paragraph, for purposes of compliance with this section, for any of its idle wells. An operator may appeal to the director pursuant to Article 6 (commencing with Section 3350) regarding the supervisor’s rejection of a plan and plan amendments and the supervisor’s determination of the operator’s failure to comply with a plan. If the supervisor’s determination that the operator failed to comply with the plan is not timely appealed, or if the director upholds the supervisor’s determination upon appeal, the operator shall immediately file the fees required under paragraph (1) for each year that the operator failed to comply with the plan. That operator may not propose a new idle well plan under this paragraph for the next two years and then only if the operator has paid all required idle well fees and any associated late payment penalties and interest.
(b) All fees received under this section shall be deposited in the Hazardous and Idle-Deserted Well Abatement Fund, which is hereby created in the State Treasury. Notwithstanding Section 13340 of the Government Code, the moneys in the Hazardous and Idle-Deserted Well Abatement Fund are hereby continuously appropriated to the department for expenditure without regard to fiscal year, to mitigate a hazardous or potentially hazardous condition by well plugging and abandonment.
(b) All fees received under this section shall be deposited in the Hazardous and Idle-Deserted Well Abatement Fund, which is hereby created in the State Treasury. Notwithstanding Section 13340 of the Government Code, the moneys in the Hazardous and Idle-Deserted Well Abatement Fund are hereby continuously appropriated to the department for expenditure without regard to fiscal year, to mitigate a hazardous or potentially hazardous condition, by well plugging and abandonment, decommissioning the production facilities, or both, at a well of an operator subject to the requirements of this section.
(c) Failure to file, for any well, the bond or fee required under this section shall be conclusive evidence of desertion of the well, permitting the supervisor to order the well abandoned.
(c) The failure to file, for any well, the fee required under this section shall be conclusive evidence of desertion of the well, permitting the supervisor to order the well abandoned pursuant to Section 3237.
(d) Nothing in this section prohibits a local agency from collecting a fee for regulation of wells.
(d) This section does not prohibit a local agency from collecting a fee for regulation of wells.
(e) Subject to the approval of the division, an idle well shall not be subject to the requirements of this section if the operator has made a diligent effort to locate and access the well, and provided documentation of those efforts demonstrating that it is infeasible to locate or physically access the wellbore.
(f) This section does not apply to an idle well that is the subject of a court-approved settlement agreement entered into on or before December 31, 2024, between a local governmental entity and the operator of the idle well, if that settlement agreement imposes more stringent requirements relating to the management and elimination of idle wells than the requirements imposed by the amendments to this section made by Assembly Bill 1866 of the 2023–24 Regular Session of the Legislature.
Official source: California Legislative Information. Reproduced from public-domain California statutes; confirm against the official source for the current text. Not legal advice.