2024 24LSO-0072
STATE OF WYOMING Committee Formal Draft
1.0
DRAFT ONLY
NOT APPROVED FOR
INTRODUCTION
HOUSE BILL NO.
Geologic sequestration-unitization amendments.
Sponsored by: Joint Minerals, Business & Economic Development Interim Committee
A BILL
for
1 AN ACT relating to environmental quality; specifying that
2 pore space utilization is a purpose of geologic
3 sequestration unitization; providing definitions; amending
4 application requirements for the unitization of interests
5 in pore space in a unit area; amending the findings
6 required by the oil and gas conservation commission before
7 entry of a unitization order; amending notice requirements
8 for unitization applications; clarifying that a unitization
9 order may provide for the use of directional wells; making
10 conforming amendments; specifying applicability; requiring
11 rulemaking; and providing for an effective date.
12
1 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 Be It Enacted by the Legislature of the State of Wyoming:
2
3 Section 1. W.S. 35-11-314(a) and (b) by creating new
4 paragraphs (ii) and (iii), 35-11-315(a)(ii), (iii), (v)
5 through (ix) and by creating a new paragraph (x) and
6 35-11-316(b)(iii) through (vii), (g) and by creating a new
7 subsection (m) are amended to read:
8
9 35-11-314. Unitization of geologic sequestration
10 sites; purposes; definitions.
11
12 (a) The purpose of W.S. 35-11-314 through 35-11-319
13 is declared by the Wyoming legislature to be the protection
14 of corresponding rights, compliance with underground
15 injection control class VI well and other environmental
16 requirements, and to facilitate the use and production of
17 Wyoming energy resources and to facilitate the utilization
18 of pore space for geologic sequestration.
19
20 (b) Except when context otherwise requires or when
21 otherwise defined in this subsection, the terms used or
22 defined in W.S. 35-11-103, shall have the same meaning when
2 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 used in W.S. 35-11-314 through 35-11-320. When used in W.S.
2 35-11-314 through 35-11-320:
3
4 (ii) "Economic benefits" means the equitable
5 proportionate share of all financial proceeds due to the
6 pore space owners in a unit area based upon each individual
7 pore space owner's contribution of pore space storage
8 capacity to a unit area;
9
10 (iii) "Unit area" means the pore space lying
11 within the geologic formation proposed to be operated and
12 may include the area of geologic sequestration for one (1)
13 or more injection wells.
14
15 35-11-315. Unitization of geologic sequestration
16 sites; agreements; application for permit; contents.
17
18 (a) Any interested person may file an application
19 with the Wyoming oil and gas conservation commission
20 requesting an order providing for the operation and
21 organization of a unit of one (1) or more parts as a
22 geologic sequestration site and for the pooling of
3 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 interests in pore space in the proposed unit area for the
2 purpose of conducting the unit operation. The application
3 shall contain:
4
5 (ii) A description of the pore space and surface
6 lands proposed to be so operated, termed the "unit area"
7 included in the unit area and the corresponding surface
8 lands;
9
10 (iii) The names, as disclosed by the conveyance
11 records of the county or counties in which the proposed
12 unit area is situated, and, if federal pore space is
13 proposed to be included in the unit area, the status
14 records of the district office of the bureau of land
15 management of:
16
17 (A) All persons owning or having an
18 interest in the surface estate and or pore space estate in
19 the unit area, including mortgages and the owners of other
20 liens or encumbrances; and
21
4 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 (B) All owners of the surface estate and or
2 pore space estate not included within but which immediately
3 adjoins that are located not greater than one-half (1/2)
4 mile from a boundary of the proposed unit area. or a corner
5 thereof.
6
7 (v) A statement of the type of operations
8 contemplated in order to effectuate the purposes specified
9 in W.S. 35-11-314 to comply with underground injection
10 control class VI well and other environmental requirements,
11 and to facilitate the use and production of Wyoming energy
12 resources or to utilize pore space for geologic
13 sequestration;
14
15 (vi) A proposed plan of unitization applicable
16 to the proposed unit area which the applicant considers
17 fair, reasonable and equitable and which shall include
18 provisions for determining the pore space to be used
19 included within the unit area, the appointment of a unit
20 operator and the time when the plan is to become effective;
21
5 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 (vii) A proposed plan for determining the
2 quantity of pore space storage capacity to be assigned to
3 each separately owned tract within the unit area and the
4 formula or method by which pore space each separately owned
5 tract will be allocated the economic benefits generated by
6 use of pore space in the unit area;
7
8 (viii) A proposed plan for generating providing
9 for economic benefits for the use of pore space within the
10 unit area;
11
12 (ix) A proposed operating plan providing the
13 manner in which the unit area will be supervised and
14 managed and, if applicable, costs allocated and paid,
15 unless all owners within the proposed unit area have joined
16 in executing an operating agreement or plan providing for
17 such supervision, management and allocation and, if
18 applicable, payment of costs. All operating plans shall
19 comply with all applicable underground injection control
20 class VI well and other environmental requirements;.
21
6 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 (x) The location of any identified and existing
2 wells, whether previously plugged or not, that may require
3 evaluation monitoring or corrective action as part of the
4 proposed geologic sequestration in the unit area.
5
6 35-11-316. Unitization of geologic sequestration
7 sites; hearings on application, order; modifications.
8
9 (b) After considering the application and hearing the
10 evidence offered in connection therewith, the Wyoming oil
11 and gas conservation commission shall enter an order
12 setting forth the following findings and approving the
13 proposed plan of unitization and proposed operating plan,
14 if any, if the commission finds that:
15
16 (iii) The application outlines operations that
17 will comply with applicable underground injection control
18 class VI well permits or any applications for permits and
19 any other environmental requirements;
20
7 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 (iv) Granting the application will facilitate
2 the use and production of Wyoming energy resources or will
3 utilize pore space for geologic sequestration;
4
5 (v) The quantity of pore space storage capacity,
6 and method used to determine the quantity of pore space
7 storage capacity allocated to each separately owned tract
8 within the unit area represents, so far as can be
9 practically determined, each tract's actual share of the
10 pore space to be used in the sequestration activity
11 included within the unit area;
12
13 (vi) The method by which for the allocation of
14 economic benefits generated from provided by the use of
15 pore space within the unit area between pore space owners;
16 and between pore space owners and the unit operator or
17 others is fair and reasonable., taking into consideration
18 the costs required to capture, transport and sequester the
19 carbon dioxide For purposes of this paragraph, federal
20 injection fees, federal lease payments and other
21 consideration derived from federal leases shall not be
22 considered;
8 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1
2 (vii) The method of generating for providing for
3 economic benefits from the use of pore space in the unit
4 area is fair and equitable and is reasonably designed to
5 maximize the value of such use of the pore space;
6
7 (g) Any owner of pore space within a geologic
8 sequestration site who has not been included within a
9 unitization application or order authorizing a unit under
10 this section, may petition for inclusion in the unit area.
11 The petition shall be filed with the Wyoming oil and gas
12 conservation commission and shall describe the petitioner's
13 legal entitlement to the pore space, the location of the
14 pore space, whether the pore space is included within any
15 permitting area applicable to the unit area and the bases
16 for inclusion in the unit area. The petition shall be
17 accompanied by a deposit of money sufficient to pay all
18 costs of the inclusion proceedings. The commission shall
19 require the petitioner to publish a provide notice of the
20 filing of the petition which to all persons specified in
21 the application for the unit area under W.S. 35-11-315(a).
22 The notice required under this subsection shall state the
9 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 filing of the petition, the name of the petitioner, the
2 location of the pore space, and the prayer of action sought
3 by the petitioner. The and any other information required
4 by rule of the commission. Upon receipt of the petition and
5 the provision of notice by the petitioner, the commission
6 shall publish notice of a hearing, which shall notify
7 describe how all interested persons to specified in an
8 application submitted under W.S. 35-11-315(a) may appear at
9 a specified time and place and to show cause, in writing,
10 if any they have, or as otherwise provided by rules of the
11 commission, why the petition should not be granted. The
12 commission at the time and place mentioned in the notice
13 shall proceed to hear the petition and all objections
14 thereto and shall thereafter grant or deny the petition.
15 The filing of the petition shall be deemed and taken as an
16 assent by each and all petitioners to the inclusion in the
17 unit of the pore space mentioned in the petition or any
18 part thereof. If the petition is granted, the petitioner
19 shall be considered to have been a member of the unit since
20 its inception and, upon the payment of any costs paid by
21 unit members, shall be entitled to a proportionate share of
22 all economic benefits received by unit members since the
10 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 inception of the unit provided that no unit modification
2 affects any permit issued under W.S. 35-11-313. The oil
3 and gas conservation commission shall adopt rules or orders
4 providing for the fair and equitable determination of pore
5 space storage capacity for each successful petitioner and
6 the means by which successful petitioners shall be paid the
7 economic benefits to which they are entitled under this
8 subsection, including, if necessary, a reallocation of
9 economic benefits among unit members.
10
11 (m) Orders for unitization issued under this section
12 may accommodate and provide for the use of horizontal or
13 directional wells that may penetrate the pore space of
14 separate pore space estates for geologic sequestration
15 purposes within the unit area.
16
17 Section 2. This act shall apply to all geologic
18 sequestration unitization orders issued on and after the
19 effective date of this section.
20
11 [Bill Number]
2024 STATE OF WYOMING 24LSO-0072
Committee Formal Draft
1.0
1 Section 3. The Wyoming oil and gas conservation
2 commission shall promulgate all rules necessary to
3 implement this act.
4
5 Section 4. This act is effective immediately upon
6 completion of all acts necessary for a bill to become law
7 as provided by Article 4, Section 8 of the Wyoming
8 Constitution.
9
10 (END)
12 [Bill Number]
Statutes affected: 24LSO-0072 v1.0: 35-11-314, 35-11-315, 35-11-316