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1 STATE OF OKLAHOMA
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2 2nd Session of the 60th Legislature (2026)
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3 SENATE BILL 1419 By: Boren
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6 AS INTRODUCED
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7 An Act relating to oil and gas operations; amending
7 52 O.S. 2021, Sections 318.4 and 318.5, which relate
8 to damages; modifying scope of certain bond
8 requirements; updating statutory reference; updating
9 statutory language; requiring certain notice;
9 establishing notice criteria; requiring certain
10 information be provided to surface owners; permitting
10 certain petition; requiring the Corporation
11 Commission to provide timely hearings; stating
11 liability of successor operators; requiring certain
12 actions before termination; requiring certain test
12 and report; requiring the Corporation Commission to
13 conduct certain hearing; authorizing the Corporation
13 Commission to take certain actions; authorizing
14 certain injunction; prohibiting certain retaliation;
14 construing provision; providing for codification; and
15 providing an effective date.
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17 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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18 SECTION 1. AMENDATORY 52 O.S. 2021, Section 318.4, is
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19 amended to read as follows:
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20 Section 318.4. A. Every operator doing business in this state
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21 shall file a corporate surety bond, letter of credit from a banking
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22 institution, cash, or a certificate of deposit with the Secretary of
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23 State in the sum of Twenty-five Thousand Dollars ($25,000.00)
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24 conditioned upon compliance with Sections 318.2 through 318.9 of
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1 this title for payment of any location damages and anticipated
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2 reclamation obligations due which the operator cannot otherwise pay.
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3 The Secretary of State shall hold such corporate surety bond, letter
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4 of credit from a banking institution, cash, or certificate of
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5 deposit for the benefit of the surface owners of this state and
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6 shall ensure that such security is in a form readily payable to a
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7 surface owner awarded damages in an action brought pursuant to this
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8 act section. Each corporate surety bond, letter of credit, cash, or
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9 certificate of deposit filed with the Secretary of State shall be
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10 accompanied by a filing fee of Ten Dollars ($10.00).
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11 B. The bonding company or banking institution shall file, for
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12 such fee as is provided for by law, a certificate that said such
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13 bond or letter of credit is in effect or has been canceled, or that
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14 a claim has been made against it in the office of the court clerk in
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15 each county in which the operator is drilling or planning to drill.
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16 Said Such bond or letter of credit must remain in full force and
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17 effect as long as the operator continues drilling operations in this
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18 state. Each such filing shall be accompanied by a filing fee of Ten
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19 Dollars ($10.00).
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20 C. Upon deposit of the bond, letter of credit, cash, or
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21 certificate of deposit, the operator shall be permitted entry upon
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22 the property and shall be permitted to commence drilling of a well
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23 or reworking operations in accordance with the terms and conditions
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24 of any lease or other existing contractual or lawful right.
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1 D. If the damages and reclamation obligations agreed to by the
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2 parties or awarded by the court are greater than the bond, letter of
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3 credit, cash, or certificate of deposit posted, the operator shall
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4 pay the damages and reclamation obligations immediately or post an
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5 additional bond, letter of credit, cash, or certificate of deposit
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6 sufficient to cover the damages. Said Such increase in bond, letter
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7 of credit, cash, or certificate of deposit shall comply with the
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8 requirements of this section.
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9 SECTION 2. AMENDATORY 52 O.S. 2021, Section 318.5, is
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10 amended to read as follows:
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11 Section 318.5. A. Prior to entering the site with heavy
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12 equipment, the operator shall negotiate with the surface owner for
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13 the payment of any damages and anticipated reclamation obligations
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14 which may be caused by the drilling operation. If the parties
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15 agree, and a written contract is signed, the operator may enter the
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16 site to drill. If agreement is not reached, or if the operator is
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17 not able to contact all parties, the operator shall petition the
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18 district court in the county in which the drilling site is located
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19 for appointment of appraisers to make recommendations to the parties
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20 and to the court concerning the amount of damages and anticipated
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21 reclamation obligations, if any. Once the operator has petitioned
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22 for appointment of appraisers, the operator may enter the site to
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23 drill.
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1 B. Ten (10) days' notice of the petition to appoint appraisers
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2 shall be given to the opposite party, either by personal service or
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3 by leaving a copy thereof at the party's usual place of residence
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4 with some family member over fifteen (15) years of age, or, in the
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5 case of nonresidents, unknown heirs or other persons whose
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6 whereabouts cannot be ascertained, by publication in one issue of a
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7 newspaper qualified to publish legal notices in said the county, as
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8 provided in Section 106 of Title 25 of the Oklahoma Statutes, said
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9 such ten-day period to begin with the first publication.
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10 C. The operator shall select one appraiser, the surface owner
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11 shall select one appraiser, and the two selected appraisers shall
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12 select a third appraiser for appointment by the court, which such
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13 third appraiser shall be a state-certified general real estate
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14 appraiser and be in good standing with the Oklahoma Real Estate
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15 Appraisal Appraiser Board. Unless for good cause shown, additional
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16 time is allowed by the district court, the three (3) appraisers
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17 shall be selected within twenty (20) days of service of the notice
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18 of the petition to appoint appraisers or within twenty (20) days of
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19 the first date of publication of the notice as specified in
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20 subsection B of this section. If either of the parties fails to
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21 appoint an appraiser or if the two appraisers cannot agree on the
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22 selection of the third appraiser within the required time period,
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23 the remaining required appraisers shall be selected by the district
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24 court upon application of either party of which at least one shall
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1 be a state-certified general real estate appraiser and be in good
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2 standing with the Oklahoma Real Estate Appraisal Appraiser Board.
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3 Before entering upon their duties, such appraisers shall take and
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4 subscribe an oath, before a notary public or some other person
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5 authorized to administer oaths, that they will perform their duties
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6 faithfully and impartially to the best of their ability. They shall
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7 inspect the real property and consider the surface damages and
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8 anticipated reclamation obligations which the owner has sustained or
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9 will sustain by reason of entry upon the subject land and by reason
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10 of drilling or maintenance of oil or gas production on the subject
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11 tract of land. The appraisers shall then file a written report
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12 within thirty (30) days of the date of their appointment with the
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13 clerk of the court. The report shall set forth the quantity,
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14 boundaries, and value of the property entered on or to be utilized
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15 in said such oil or gas drilling, and the amount of surface damages
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16 and reclamation done or to be done to the property. The appraisers
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17 shall make a valuation and determine the amount of compensation to
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18 be paid by the operator to the surface owner and the manner in which
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19 the amount shall be paid. Said The appraisers shall then make a
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20 report of their proceedings to the court. The compensation of the
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21 appraisers shall be fixed and determined by the court. The operator
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22 and the surface owner shall share equally in the payment of the
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23 appraisers' fees and court costs.
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1 D. Within ten (10) days after the report of the appraisers is
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2 filed, the clerk of the court shall forward to each attorney of
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3 record, each party, and interested party of record, a copy of the
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4 report of the appraisers and a notice stating the time limits for
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5 filing an exception or a demand for jury trial as provided for in
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6 this section. The operator shall provide the clerk of the court
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7 with the names and last-known addresses of the parties to whom the
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8 notice and report shall be mailed, sufficient copies of the notice
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9 and report to be mailed, and pre-addressed, postage-paid envelopes.
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10 1. This notice shall be on a form prepared by the
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11 Administrative Director of the Courts, approved by the Oklahoma
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12 Supreme Court, and supplied to all district court clerks.
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13 2. If a party has been served by publication, the clerk shall
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14 forward a copy of the report of the appraisers and the notice of
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15 time limits for filing either an exception or a demand for jury
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16 trial to the last-known mailing address of each party, if any, and
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17 shall cause a copy of the notice of time limits to be published in
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18 one issue of a newspaper qualified to publish legal notices as
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19 provided in Section 106 of Title 25 of the Oklahoma Statutes.
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20 3. After issuing the notice provided herein, the clerk shall
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21 endorse on the notice form filed in the case the date that a copy of
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22 the report and the notice form was forwarded to each attorney of
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23 record, each party, and each interested party of record, or the date
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24 the notice was published.
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1 E. The time for filing an exception to the report or a demand
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2 for jury trial shall be calculated as commencing from the date the
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3 report of the appraisers is filed with the court. Upon failure of
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4 the clerk to give notice within the time prescribed, the court, upon
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5 application by any interested party, may extend the time for filing
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6 an exception to the report or filing a demand for trial by jury for
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7 a reasonable period of time not less than twenty (20) days from the
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8 date the application is heard by the court. Appraisers' Appraiser
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9 fees and court costs may be the subject of an exception, may be
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10 included in an action by the petitioner, and may be set and allowed
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11 by the court.
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12 F. The report of the appraisers may be reviewed by the court,
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13 upon written exceptions filed with the court by either party within
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14 thirty (30) days after the filing of the report. After the hearing
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15 the court shall enter the appropriate order either by confirmation,
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16 rejection, modification, or order of a new appraisal for good cause
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17 shown. Provided, that in the event a new appraisal is ordered, the
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18 operator shall have continuing right of entry subject to the
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19 continuance of the bond required herein. Either party may, within
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20 sixty (60) days after the filing of such report, file with the clerk
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21 a written demand for a trial by jury, in which case the amount of
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22 damages shall be assessed by a jury. The trial shall be conducted
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23 and judgment entered in the same manner as railroad condemnation
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24 actions tried in the court. A copy of the final judgment shall be
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1 forwarded to the county assessor in the county or counties in which
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2 the property is located. If the party demanding the jury trial does
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3 not recover a more favorable verdict than the assessment award of
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4 the appraisers, all court costs including reasonable attorney fees
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5 shall be assessed against the party.
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6 SECTION 3. NEW LAW A new section of law to be codified
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7 in the Oklahoma Statutes as Section 318.11 of Title 52, unless there
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8 is created a duplication in numbering, reads as follows:
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9 A. In addition to all notices required by Section 318.3 of
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10 Title 52 of the Oklahoma Statutes, an operator shall provide written
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11 notice to the surface owner at least thirty (30) days before:
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12 1. A transfer of operator;
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13 2. Assignment of a lease or wellbore interest; or
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14 3. Any transaction that changes control of a well, facility, or
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15 associated equipment.
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16 B. The notice shall include:
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17 1. Names and addresses of the proposed successor;
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18 2. A list of wells and facilities affected;
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19 3. The date the transfer is proposed to be presented to the
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20 Corporation Commission; and
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21 4. A summary of due-diligence materials required pursuant to
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22 Section 4 of this act.
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1 SECTION 4. NEW LAW A new section of law to be codified
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2 in the Oklahoma Statutes as Section 318.12 of Title 52, unless there
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3 is created a duplication in numbering, reads as follows:
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4 A. Upon written request, the operator or proposed successor
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5 shall provide to the surface owner:
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6 1. Mechanical integrity reports and well-status documentation;
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7 2. Environmental assessments, spill reports, and inspection
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8 results;
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9 3. Plugging and site-restoration cost estimates;
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10 4. Financial assurance instruments submitted to the Corporation
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11 Commission; and
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12 5. Any documents required pursuant to Corporation Commission
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13 rules for transfer approval.
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14 B. Documents shall be delivered in electronic or paper format
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15 within ten (10) business days.
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16 C. Failure to provide disclosures shall constitute a violation
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17 of this act.
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18 SECTION 5. NEW LAW A new section of law to be codified
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19 in the Oklahoma Statutes as Section 318.13 of Title 52, unless there
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20 is created a duplication in numbering, reads as follows:
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21 A. A surface owner has standing before the Corporation
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22 Commission to request enforcement of this act.
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23 B. A surface owner may file a petition alleging inadequate due
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24 diligence, insufficient financial assurance, likelihood of
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1 abandonment, violation of notice or disclosure requirements, or
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2 regulatory noncompliance.
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3 C. Upon petition, the Commission may stay or suspend a
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4 transfer, require additional bonding, order inspections or
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5 remediation, impose civil penalties, or deny or condition approval.
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6 D. The Commission shall provide timely hearings and full
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7 participation rights to surface owners.
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8 SECTION 6. NEW LAW A new section of law to be codified
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9 in the Oklahoma Statutes as Section 318.14 of Title 52, unless there
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10 is created a duplication in numbering, reads as follows:
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11 A. Obligations pursuant to this act run with the well and bind
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12 all successor operators.
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13 B. Transfers that shift wells into undercapitalized or
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14 nonoperational entities are presumed fraudulent and shall not
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15 relieve the transferring operator of liability.
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16 C. Successor operators are jointly and severally liable with
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17 the transferor for violations involving inadequate due diligence,
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18 false or misleading disclosures, insufficient financial assurance,
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19 or lack of required approval or notice.
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20 D. No operator may dissolve, withdraw, or terminate its
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21 business entity in this state until certifying satisfaction of all
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22 obligations pursuant to this act.
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1 SECTION 7. NEW LAW A new section of law to be codified
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2 in the Oklahoma Statutes as Section 318.15 of Title 52, unless there
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3 is created a duplication in numbering, reads as follows:
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4 A. Before any hydraulic fracturing, acidizing, pressure
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5 treatment, or reworking activity, the operator shall perform a
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6 fracture-point or formation integrity test prior to any new
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7 drilling, reworking, or stimulation activity to:
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8 1. Determine the fracture initiation pressure of each zone at
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9 which the formation will crack;
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10 2. Determine safe pressure limits for the proposed treatment;
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11 3. Confirm isolation of groundwater-bearing formations;
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12 4. Determine operation risk on the groundwater, soil, or nearby
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13 wells;
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14 5. Prevent unintended fracture propagation;
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15 6. Ensure casing, cement, and completion integrity; and
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16 7. Ensure that the surface owner is fully informed of
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17 activities affecting his or her property.
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18 B. A report of results received from the test required pursuant
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19 to subsection A of this section shall be filed no less than thirty
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20 (30) days before any hydraulic fracturing or reworking begins under
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21 oath with the Corporation Commission and shall also be provided to
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22 the surface owner and all interest owners within the same time
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23 frame. The report shall include the following:
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24 1. Test results;
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1 2. The maximum pressure that will be used;
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2 3. Any risks identified during testing; and
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3 4. Steps the operator will take to prevent damage.
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4 C. If the test indicates a risk of fracture propagation into
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5 freshwater zones, producing horizons, or abandoned wells, the
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6 Commission shall conduct a hearing to consider the following
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7 remedies:
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8 1. Revised stimulation plans;
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9 2. Lower pressure limits;
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10 3. Stimulation prohibition; or
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11 4. Additional casing or cement remediation.
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12 D. Inadequate or false testing shall constitute grounds for the
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13 Commission to enforce civil penalties, denial or revocation of an
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14 operator's permit, or joint and several liability pursuant to
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15 Section 6 of this act.
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16 E. If an operator fails to conduct the test or exceeds the
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17 tested pressure limits, the surface owner may seek an injunction to
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18 stop the operation and the operator shall be liable for any
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19 resulting damages. The Commission may halt the operation, impose
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20 penalties, or deny further permits.
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21 F. A surface owner who asks for or uses the information from
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22 the fracture-point test shall not be harassed, pressured, or
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23 retaliated against by the operator. Any retaliation constitutes
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24 actionable damages.
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1 G. This section shall be liberally construed to protect surface
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2 owners, water supplies, agricultural land, rural communities, and
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3 responsible operators.
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4 SECTION 8. This act shall become effective November 1, 2026.
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Req. No. 3086 Page 13Every fact on this page links to its source, starting with the official bill record.