The bill amends the Oil and Gas Reclamation Fund by increasing the tax rate imposed under the Oil and Gas Conservation Tax Act that is distributed to the fund. Specifically, it changes the distribution amount to be equal to the net receipts attributable to the tax, rather than a fixed percentage. Additionally, the bill mandates that expenditures from the fund shall be used solely for specific purposes related to the plugging of abandoned wells and the restoration of well sites, as outlined in the new legal language.

Furthermore, the bill establishes a minimum funding requirement for these activities, ensuring that either $40 million or 5% of the average market value of the fund over the past three years is dedicated to employing personnel for surveying abandoned wells and preparing plans for their remediation. It also includes provisions for the oil conservation division to reclaim and properly plug abandoned wells, with the authority to seek indemnification from operators for costs incurred. The bill requires an annual report on the fund's usage and allows contractors to sell salvaged equipment from well sites, deducting the proceeds from their costs. The provisions of this act will take effect on July 1, 2025.

Statutes affected:
introduced version: 7-1-6.21, 70-2-38