R649-13-7. Requirements for Performance Bond Release

(1) The owner or operator may request release of a bond by submitting a request for bond release together with a certification of the mailing of the same to interested parties having standing to challenge the same, including the surface landowner. (a) Within 30 days of filing a request for bond release with the division, the operator shall submit signed affidavits from the surface landowner of the bonded site certifying that restoration has been performed as required by the surface agreements or to the satisfaction of the parties. These affidavits shall be used by the division in determination of final bond release as required by Subsection R649-3-34(13). (i) If such affidavits are not submitted, the division shall conduct an inspection in accordance with Subsection (1)(b) upon receiving a written request from the operator. (ii) The division shall give the operator and surface landowner notice of the date and time of the inspection. If either the operator or the surface landowner are unable to attend the inspection at the scheduled time and date, the division may reschedule the inspection to allow the operator or surface landowner to participate. (b) Before the approval of a bond release, the division shall conduct an evaluation and inspection of the bonded site as follows: (i) within 60 days of the filing of the request for bond release, or the conclusion of any associated informal adjudicative proceeding described in Subsection R649-13-6(2)(b), or as soon thereafter as weather conditions permit, the division shall conduct an inspection and evaluation of the bonded site to determine if restoration has been adequately performed. (ii) The division's evaluation and inspection shall consider the adequacy of the bonded site restoration, the degree of difficulty to complete any remaining restoration, whether pollution of surface and subsurface water is occurring, the probability of future occurrence of such pollution, and the estimated cost of abating such pollution. (iv) The adequacy of a well site restoration will also evaluate any restoration requirements provided for in Section R649-3-34. (v) The division shall retain a record of the evaluation and inspection according to the division's approved retention schedule. (2)(a) If no written objection to the request for bond release is received by the division within 30 days after the filing of the request, the division may release liability under the bond as an administrative action, subject to the evaluation and inspection described in Subsection (1)(b). (b) If a written objection to the request for bond release is received by the division within 30 days after the filing of the request, the request shall be set for an informal adjudicative proceeding and notice thereof given in accordance with the procedural rules of the division under Rule R649-10. (i) within 60 days of the conclusion of any associated informal adjudicative proceeding, or as soon thereafter as weather conditions permit, whichever is the later, the division shall conduct an inspection and evaluation of the bonded site to determine if restoration has been adequately performed. (3)(a) The division shall give written notice of its decision to release or not to release all or part of the performance bond within 30 days after the completion of the inspection and evaluation. (b) The following parties will be notified of the division's decision: (i) the operator; (ii) the surety or other guarantor of the bond; (iii) other persons with an interest in bond collateral who have requested notification under Subsection R649-13-1(2)(c)(v); (iv) the persons who filed written objections to the notice of application for bond release; and (v) any other interested parties identified in the certification of mailing in Subsection (1). (c) If the decision is made to release the bond, the notification shall also state the effective date of the bond release. (d) If the division denies the request for bond release or a portion thereof, the written notice shall state the reasons for denial and recommend corrective actions necessary to secure the release. (4) Release of bond liability shall be conditioned upon compliance with Title 40, Chapter 6, Board and Division of Oil, Gas and Mining, Title R649, Natural Resources; Oil, Gas and Mining; Oil and Gas, and orders of the division and board. (5) The denial of a request for bond release may be appealed by filing a request for agency action with the division pursuant to Rule R649-10.