1     
OIL, GAS, AND MINING AMENDMENTS

2     
2015 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kevin T. Van Tassell

5     
House Sponsor: Scott H. Chew

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions relating to drilling units.
10     Highlighted Provisions:
11          This bill:
12          ▸     allows the Board of Oil, Gas, and Mining to allow more than one well to be drilled
13     in a drilling unit under certain circumstances; and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          None
19     Utah Code Sections Affected:
20     AMENDS:
21          40-6-6, as repealed and reenacted by Laws of Utah 1992, Chapter 34
22     

23     Be it enacted by the Legislature of the state of Utah:
24          Section 1. Section 40-6-6 is amended to read:
25          40-6-6. Drilling units -- Establishment by board -- Modifications -- Prohibitions.
26          (1) The board may order the establishment of drilling units for [any] a pool.
27          (2) Within each drilling unit, only one well may be drilled for production from the
28     common source of supply, except as provided in [Subsection] Subsections (6) and (7).
29          (3) A drilling unit may not be smaller than the maximum area that can be efficiently
30     and economically drained by one well.
31          (4) (a) Each drilling unit within a pool shall be of uniform size and shape, unless the
32     board finds that it must make an exception due to geologic, geographic, or other factors.
33          (b) If the board finds it necessary to divide a pool into zones and establish drilling units
34     for each zone, drilling units may differ in size and shape for each zone.
35          (5) An order of the board that establishes drilling units for a pool shall:
36          (a) be made upon terms and conditions that are just and reasonable;
37          (b) include all lands determined by the board to overlay the pool;
38          (c) specify the acreage and shape of each drilling unit as determined by the board; and
39          (d) specify the location of the well in terms of distance from drilling unit boundaries
40     and other wells.
41          (6) The board may establish a drilling unit and concurrently authorize the drilling of
42     more than one well in a drilling unit if the board finds that:
43          (a) engineering or geologic characteristics justify the drilling of more than one well in
44     that drilling unit; and
45          (b) the drilling of more than one well in the drilling unit will not result in waste.
46          [(6)] (7) The board may modify an order that establishes drilling units for a pool to
47     provide for:
48          (a) an exception to the authorized location of a well;
49          (b) the inclusion of additional areas which the board determines overlays the pool;
50          (c) the increase or decrease of the size of drilling units; or
51          (d) the drilling of additional wells within drilling units.
52          [(7)] (8) (a) After an order establishing drilling units has been entered by the board, the
53     drilling of [any] a well into the pool at a location other than that authorized by the order is
54     prohibited.
55          (b) The operation of [any] a well drilled in violation of an order fixing drilling units is
56     prohibited.




Legislative Review Note
     as of 2-10-15 9:40 AM

Office of Legislative Research and General Counsel