Senate Bill 2317

AN ACT TO REGULATE THE SEISMOLOGICAL EXPLORATION FOR OIL, GAS OR OTHER MINERALS; TO DEFINE TERMS; TO DIRECT THE OIL AND GAS BOARD TO PROMULGATE RULES GOVERNING SEISMOGRAPHIC EXPLORATION; TO REQUIRE SEISMOGRAPHIC OPERATORS TO REGISTER; TO REQUIRE A PERMIT FOR EACH SEISMIC OPERATION; TO REQUIRE THE POSTING OF A SECURITY BOND TO GUARANTEE PERFORMANCE AND FOR REPARATION OF DAMAGES; TO REQUIRE THAT SURFACE OWNERS BE NOTIFIED BEFORE SEISMIC OPERATIONS ARE CONDUCTED; TO PROHIBIT FRAUDULENT APPLICATIONS AND REPORTS; TO PROHIBIT TEST-HOLE BLASTING WITHIN A CERTAIN DISTANCE OF BUILDINGS OR WATER WELLS; TO PROVIDE THE PENALTY FOR VIOLATIONS; AND FOR RELATED PURPOSES.

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

SECTION 1. (1) For purposes of this section:

(a) "Seismic operations" means the drilling of seismography test holes and the use of surface energy sources such as weight drop equipment, thumpers, hydropulses or vibrators to artificially produce vibrations in the earth in the exploration for oil, gas or other minerals.

(b) "Board" means the Mississippi Oil and Gas Board.

(2) The board shall promulgate rules governing seismic operations for the purpose of protecting the interests and property of the citizens of this state and to comply with this section.

(a) The rules may require the payment of a registration fee not to exceed Five Hundred Dollars ($500.00) and a permit fee not to exceed One Hundred Dollars ($100.00).

(b) The rules shall also implement a system to register complaints against any person conducting seismic operations in violation of this section or for uncompensated damages resulting from seismic operations. The board may determine if and when a complaint has been adequately resolved.

(3) Before commencing any seismic operation in this state, a person must register with the board.

(4) (a) A person must apply for a permit for each separate seismic operation. The application for a permit shall be made on forms prescribed by the board. The application shall include the name and principal business address of the applicant, the location in the state where the applicant plans to conduct seismic exploration, a designated agent for service of process in Mississippi, and such other information as may be prescribed by rule.

(b) (i) The application shall be accompanied by a bond in the amount of at least Fifty Thousand Dollars ($50,000.00) as prescribed by the board, but not to exceed Two Hundred Fifty Thousand Dollars ($250,000.00).

(ii) The bond shall be executed by the applicant, as principal, and a corporate surety approved by the board, and shall be conditioned that the permittee shall pay all damages resulting from the seismic operations.

(iii) The bond shall be maintained in the amount set by the board so long as the permittee is conducting seismic operations in the state and until released by the board.

(c) (i) An applicant must notify all surface owners of property where seismic operations will occur at least fifteen (15) days before commencement of seismic operations. The notice shall include a copy of the oil or gas lease or seismic permit authorizing the use of the surface for seismic operations and contain the following information:

1. Name of the company conducting seismic operations;

2. Anticipated date of seismic operations; and

3. Any other information the board considers relevant for the protection of surface owners.

(ii) Notice by United States mail postmarked at least fifteen (15) days before commencement of seismic operations is sufficient.

(iii) An applicant that has obtained specific written authorization and given actual notice of intent to conduct seismic operations any time before fifteen (15) days before conducting seismic exploration is deemed to have given notice for the purposes of this section.

(5) (a) It is unlawful for any person to conduct any seismic test-hole blasting within two hundred (200) feet of any building or water well without written permission of the owner of the property.

(b) It is unlawful for any person to perform any seismic operations in this state unless the person first obtains a permit to do so under this section.

(c) A person that conducts any seismic operation without a permit or that violates this section or the rules of the board governing the operation shall be subject to a penalty to be imposed by the board of One Thousand Dollars ($1,000.00) per violation per day, in addition to any other legal remedy provided by law to the board or to any aggrieved person.

(d) Any person who, for the purpose of evading this section or any rule promulgated under this section, intentionally makes or causes to be made a false entry or statement of fact in an application or registration required to be made by this section or by any rule promulgated under this section; or who, for that purpose, omits to make, or causes to be omitted, any entry, statement of fact, or report required to be made by this section or any rule promulgated under this section; or who, for such purpose, moves out of the jurisdiction of the state, shall be guilty of a misdemeanor and shall be subject to a fine of not more than Five Thousand Dollars ($5,000.00) or imprisonment for a term of not more than six (6) months, or both.

(6) Any surface owner seeking to recover under the applicable bond for damages caused by seismic operations must file a written notice of claim therefor with the board within one (1) year of the date of expiration of the permit for conducting the operations, but the surface owner's claim shall be subordinate to the rights of the board under the bond to secure compliance by the permittee with the provisions of this section and the rules of the board promulgated under this section.

SECTION 2. This act shall take effect and be in force from and after July 1, 2015.