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 of the tax rate. 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 associated production facilities, rather than allowing for broader uses.

Furthermore, the bill establishes a minimum funding requirement for these activities, ensuring that either $40 million or 5% of the average year-end market values 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 outlines the authority of the oil conservation division to reclaim and plug abandoned wells, including on federal lands, and allows for indemnification against operators for costs incurred in these efforts. The bill requires an annual report on the fund's usage and clarifies the definition of "associated production facilities" to include various facilities related to oil and gas operations. The provisions of this act are set to take effect on July 1, 2025.

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