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, rather than allowing for broader uses previously permitted.

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 the necessary personnel and plans for managing abandoned wells. It also outlines the authority of the oil conservation division to reclaim and plug abandoned wells, including on federal lands, and allows for indemnification from operators for costs incurred. The bill requires an annual report on the fund's usage and clarifies the definition of "associated production 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