SB2463: OIL AND GAS ACT-SURETY BONDS

Legislative Summary

Amends the Illinois Oil and Gas Act. Removes cash as an item that an applicant may provide in lieu of a surety bond required for plugging obligations. Changes the bond requirements for (1) an applicant that has not been issued a permit that is not of record with the Department of Natural Resources on the effective date of the amendatory Act or (2) is a permittee on record with the Department that has failed to make the required assessments under the Act at any time in the preceding 5 years. Requires the applicant or permittee to execute and file with the Department a bond in an amount estimated to cover the cost of plugging and restoring the well site at the following rates: $10,000 for one well, $25,000 in total covering a blanket bond for up to 10 wells, $50,000 in total covering a blanket bond for up to 50 wells, or $100,000 in total covering a blanket bond for up to 100 wells. Provides that a blanket bond covering more than 100 wells is increased to include the bond amount for the total number of wells more than 100 that will be covered by the blanket bond. Requires that a bond must be submitted to the Department for all wells before drilling, deepening, converting, or operating any well for which a new or transfer permit is required and that has not previously been plugged and abandoned in accordance with the Act. Requires the Department to release the bond if (i) all wells covered by the bond are plugged and all well sites are restored in accordance with the amendatory Act and administrative rules, (ii) all wells covered by the bond are transferred in accordance with the amendatory Act and administrative rules, and (iii) the permittee pays assessments to the Department in accordance with the Act for 5 consecutive years from the date of issuance of a permit after the effective date of the amendatory Act and the permittee is not in violation of the amendatory Act or any administrative rules. Makes conforming changes.