Bond

Before any person receives a permit to drill, bore, excavate, or construct a geothermal energy extraction facility, the person shall submit to the commission and obtain its approval of a surety bond or cash bond. An alternate form of security may be approved by the commission after notice and hearing, as provided by law. At the discretion of the state geologist, an installation or facility bond may be required for the substantial modification of a geothermal energy extraction facility in existence prior to December 1, 1992. The state geologist has the discretion to waive the requirement for a facility bond if the applicant is an instrumentality of the state. Each such bond must be executed by a responsible surety company authorized to transact business in this state. The amount and type of the bond is as follows: Shallow-well and horizontal-loop facilities. 1. The state geologist has the discretion to require a facility bond in the amount of fifteen thousand dollars for any geothermal energy extraction facility that, for any reason, constitutes a special threat to important ground water resources or the environment, or otherwise poses a significant public health hazard. 2. An installation bond in the amount of ten thousand dollars is required of installers of all geothermal energy extraction. This is a blanket bond and must cover all permits for geothermal energy extraction facilities issued in one year commencing on the date the first permit covered by the bond is issued. Alternately, at the discretion of the state geologist, an installation bond in the amount of one hundred dollars for each well or horizontal loop installed per year may be submitted. 3. The geothermal system installer must comply with North Dakota Century Code chapter 38-19 and all rules and orders of the commission as a condition of the installer's bond. Any violation of either North Dakota Century Code chapter 38-19 or the rules or orders of the commission makes the installer liable under the bond and the bond shall be subject to immediate forfeiture. The installer remains liable under the installation bond until construction of the geothermal energy extraction facility has been completed and the work has been approved by the state geologist. At the discretion of the state geologist, the installer's liability under the bond may be terminated at an earlier date when it can be demonstrated that only minor interior work remains to be completed and when completion of this work is subject to inordinate delays beyond the control of the geothermal system installer. The owner of a geothermal energy extraction facility is responsible for obtaining the facility bond in subsection 1. The owner of the geothermal energy extraction facility who is required to obtain a facility bond under subsection 1 must comply with North Dakota Century Code chapter 38-19 and all rules and orders of the commission as a condition of the owner's bond. Any violation of either North Dakota Century Code chapter 38-19 or the rules or orders of the commission makes the owner liable under the facility bond, and the bond shall be subject to immediate forfeiture. The owner of the geothermal energy extraction facility remains liable under the bond until either of the following occurs: (1) the wells or loop systems have been satisfactorily plugged as provided in this chapter, the sites disturbed by any method of production of geothermal energy have been reclaimed in a manner approved by the state geologist, and all logs, plugging records, and other pertinent data required by statute or rules and orders of the commission are filed and approved; or (2) the liability on the bond has been transferred to another bond and such transfer approved by the commission. The commission shall advise the surety and the principal when liability on a surety bond is terminated. The state geologist is authorized to act for the commission as to all matters within this section.