House Bill 1264

(As Passed the House)

AN ACT TO AMEND SECTION 75-57-13, MISSISSIPPI CODE OF 1972, TO REQUIRE THE STATE OIL AND GAS BOARD TO MAKE CERTAIN FINDINGS FOR THE ISSUANCE OF A PERMIT FOR THE CREATION OF UNDERGROUND STORAGE SPACES FOR UNDERGROUND STORAGE OF GASES IN RESERVOIRS DISSOLVED IN SALT BEDS; TO AMEND SECTION 53-3-155, MISSISSIPPI CODE OF 1972, IN CONFORMITY THERETO; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 75-57-13, Mississippi Code of 1972, is amended as follows:

75-57-13. It is expressly provided that, subsequent to the issuance of a permit by the Mississippi State Oil and Gas Board permitting the creation of such spaces, compressed air, liquefied compressed gases, refined hydrocarbons, oil or gas, or both, and those liquefied compressed gases known as butane or propane or mixtures thereof, may be stored in artificially formed underground storage spaces where such cavities are dissolved in salt beds and that the provisions of Section 53-3-155 shall be applicable for the issuance of a permit for the creation and use of such spaces. The Oil and Gas Board shall exercise jurisdiction over safety precautions regarding the storage and transmission of the compressed air, liquefied compressed gases, refined hydrocarbons, oil or gas, or both, only while it is underground and in the associated wellhead facilities as prescribed and set out in Section 53-1-17(3)(p). The State Liquefied Compressed Gas Board shall be responsible for promulgating and enforcing safety standards beyond the associated wellhead facilities, during transmission above ground and while the compressed air, liquefied compressed gases, refined hydrocarbons, oil and gas is stored above ground.

SECTION 2. Section 53-3-155, Mississippi Code of 1972, is amended as follows:

53-3-155. The use of an underground reservoir, stratum or formation as a reservoir for the storage of natural gas or compressed air as an appliance or appurtenance in connection with the conveying, transmission or distribution of natural gas or compressed air or gases in reservoirs dissolved in salt beds as prescribed under Section 75-57-13 is hereby authorized, provided that the State Oil and Gas Board shall first enter an order, after notice and hearing pursuant to the provisions of Sections 53-1-19 through 53-1-31, inclusive, approving any such proposed underground storage of natural gas or compressed air or gases in reservoirs dissolved in salt beds as prescribed under Section 75-57-13 upon finding as follows:

(a) That the underground stratum or formation sought to be used as a reservoir for the injection, storage and withdrawal of natural gas or compressed air is suitable and feasible for such use and in the public interest, and is not an oil reservoir capable of commercial production;

(b) That a majority interest of all rights of the surface interest and a majority interest of all interests in the underground stratum or formation have consented to such use in writing;

(c) That the use of the underground stratum as a reservoir for the storage of natural gas or compressed air will not contaminate other formations containing fresh water, oil, gas or other commercial mineral deposits; and

(d) That the proposed storage will not endanger lives or property.

SECTION 3. This act shall take effect and be in force from and after July 1, 2014.