2009 North Carolina Code
Chapter 113 - Conservation and Development.
§ 113-391. Jurisdiction and authority; rules and orders.

§ 113‑391.  Jurisdiction and authority; rules and orders.

(a)        The Department shall have jurisdiction and authority of and over all persons and property necessary to administer and enforce effectively the provisions of this law and all other laws relating to the conservation of oil and gas.

(b)        The Department shall have the authority and it shall be its duty to make such inquiries as it may think proper to determine whether or not waste over which it has jurisdiction exists or is imminent.  In the exercise of such power the Department shall have the authority to collect data; to make investigations and inspections; to examine properties, leases, papers, books and records; to examine, check, test and gauge oil and gas wells, tanks, refineries, and means of transportation; to hold hearings; and to provide for the keeping of records and the making of reports; and to take such action as may be reasonably necessary to enforce this law.

(c)        The Department may make rules and orders as may be necessary from time to time in the proper administration and enforcement of this law, including rules or orders for the following purposes:

(1)        To require the drilling, operation, casing and plugging of wells to be done in such manner as to prevent the escape of oil or gas out of one stratum to another; to prevent the intrusion of water into an oil or gas stratum from a separate stratum; to prevent the pollution of freshwater supplies by oil, gas or salt water, or to protect the quality of the water, air, soil or any other environmental resource against injury or damage or impairment; and to require reasonable bond condition for the performance of the duty to plug each dry or abandoned well.

(2)        To require directional surveys upon application of any owner who has reason to believe that a well or wells of others has or have been drilled into the lands owned by him or held by him under lease.  In the event such surveys are required, the costs thereof shall be borne by the owners making the request.

(3)        To require the making of reports showing the location of oil and gas wells, and the filing of logs and drilling records.

(4)        To prevent the drowning by water of any stratum or part thereof capable of producing oil or gas in paying quantities, and to prevent the premature and irregular encroachment of water which reduces, or tends to reduce, the total ultimate recovery of oil or gas from any pool.

(5)        To require the operation of wells with efficient gas‑oil ratios, and to fix such ratios.

(6)        To prevent "blow‑outs," "caving" and "seepage" in the sense that conditions indicated by such terms are generally understood in the oil and gas business.

(7)        To prevent fires.

(8)        To identify the ownership of all oil or gas wells, producing leases, refineries, tanks, plants, structures and all storage and transportation equipment and facilities.

(9)        To regulate the "shooting," perforating, and chemical treatment of wells.

(10)      To regulate secondary recovery methods, including the introduction of gas, air, water or other substances into producing formations.

(11)      To limit and prorate the production of oil or gas, or both, from any pool or field for the prevention of waste as herein defined.

(12)      To require, either generally or in or from particular areas, certificates of clearance or tenders in connection with the transportation of oil or gas.

(13)      To regulate the spacing of wells and to establish drilling units.

(14)      To prevent, so far as is practicable, reasonably avoidable drainage from each developed unit which is not equalized by counter‑drainage.

(15)      To prevent where necessary the use of gas for the manufacture of carbon black.

(16)      To regulate and, if necessary in its judgment for the protection of unique environmental values, to prohibit the location of wells in the interest of protecting the quality of the water, air, soil or any other environmental resource against injury, or damage or impairment. (1945, c. 702, s. 11; 1971, c. 813, ss. 5, 6; 1973, c. 1262, s. 86; 1987, c. 827, s. 111; 1989, c. 727, s. 120.)