SECTIONS 3260-3266 - California Statutes

PUBLIC RESOURCES CODE

SECTION 3260-3266

3260. For purposes of this article, the following definitions
apply:
(a) "Account" means the Acute Orphan Well Account established
under Section 3261.
(b) "Acute orphan well" means a well that the supervisor
determines could pose an immediate danger to life, health, or natural
resources and there is no operator determined by the supervisor to
be responsible for plugging and abandoning the well pursuant to
subdivision (c) of Section 3237 or who is able to respond.

3261. (a) Notwithstanding any other provision of this chapter,
including the expenditure limitations of Section 3258, the division
shall administer and manage the Acute Orphan Well Account, which is
hereby established in the Oil, Gas, and Geothermal Administrative
Fund.
(b) Except as expressly provided in Section 3264, the account
shall only be used, upon appropriation, to plug, abandon, and further
secure an acute orphan well. Use of the account is limited to the
minimum work necessary to eliminate any immediate risk to life,
health, or natural resources.

3262. (a) The Conservation Committee of the California Oil and Gas
Producers shall act as an advisory committee, for the purposes of
this article only, to assist the division in adopting criteria for
determining whether a well is acute, and the level of surface or
subsurface work necessary to plug and abandon and secure the well to
eliminate the immediate risk to life, health, or natural resources.
The division shall give substantial deference to these
recommendations.
(b) If a recommendation of the committee is not followed, the
division shall provide a written justification, approved by the
supervisor, for not following the recommendation.
(c) The supervisor shall periodically consult with the
Conservation Committee of the California Oil and Gas Producers to
determine if the criteria developed pursuant to this section are
being applied consistently, or if the criteria require revision to
reflect changing circumstances.

3263. (a) The division shall establish the following fees, up to a
maximum of one million dollars ($1,000,000) annually, and payable to
the division, for the sole purpose of carrying out the activities
described in Section 3261:
(1) There shall be imposed annually upon the person operating each
oil and gas well in this state, or owning royalty or other interests
in respect to the production from the well, a charge that shall be
payable to the division and that shall be computed at a uniform rate
per barrel of oil and at a uniform rate per 10,000 cubic feet of
natural gas produced from the well for the preceding calendar year,
other than gas that is used for recycling or otherwise in
oil-producing operations, not to exceed an aggregate total of up to
five hundred thousand dollars ($500,000) annually from all operating
wells in the state. The fees to be paid shall be apportioned among
all of those persons in fractional amounts proportionate to their
respective fractional interests in respect to the production of the
well, but the whole of the discharge shall be payable by the
operator, who shall withhold their respective proportionate shares of
the charge from the amounts otherwise payable or deliverable to the
owners of royalty or other interests.
(2) There shall be imposed annually upon the person operating each
idle well in this state, as defined in subdivision (d) of Section
3008, a charge that shall be payable to the division. The maximum
aggregate charge to be collected by the division shall not exceed
five hundred thousand dollars ($500,000) annually. The amount of the
charge to be assessed shall be determined by equally dividing the
maximum aggregate annual charge to be collected by the total number
of idle wells as of December 31 of the preceding year.
(b) The fee collections shall commence on March 1, 2006, based on
production and idle well statistics as of December 31, 2005. The fee
collections for 2007 shall be calculated based on production and idle
well statistics as of December 31, 2006.
(c) Unless authorized by the Legislature, on or after January 1,
2008, the division shall not collect the fees established pursuant to
subdivision (a).

3264. Notwithstanding the limitations contained in Section 3261
upon appropriation, a maximum of 5 percent of the total annual fees
deposited in the account may be used by the division to administer
the account, and to reimburse the division for any costs associated
with developing the criteria required under Section 3262 and any
costs incurred for the development of regulations authorized under
Section 3266.

3265. If the balance in the account exceeds one million five
hundred thousand dollars ($1,500,000) at the start of the fiscal
year, the collection of all fees set forth in Section 3263 shall be
suspended for that year.

3266. The division may adopt regulations to implement this article.