2010 Arizona Revised Statutes
Title 27 - Minerals, Oil and Gas
27-654 Drilling bond; amount; responsibility

27-654. Drilling bond; amount; responsibility

A. The commission shall require every person who engages in the drilling, ownership or operation of a well, or the entering or deepening of an abandoned well, to file with the commission, on a form to be determined by the commission, a reasonable bond with good and sufficient security conditioned upon the performance of the duties required by this section and the duties upon abandonment, as approved by the commission, of the well in an amount to be determined by the commission.

B. In no case may the bond be less than five thousand dollars for each individual well or less than twenty-five thousand dollars for any number of wells.

C. The bond shall remain in full force and effect until all requirements of the commission have been satisfied or until otherwise released by the commission.

D. The owner or operator is responsible for the full cost of plugging each dry or abandoned well. If the owner or operator fails to properly plug and abandon the well, the commission may:

1. Forfeit the bond and use the money for that purpose.

2. Sue the owner or operator for costs in excess of the amount of the bond and the owner or operator is liable for that amount.