New Surety Bond Amounts for Missouri Oil and Gas Well Operators
Tuesday May 3, 2016
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As of March 30th, oil and gas well operators in Missouri face new bonding requirements, and some changes to how their bond amount is calculated. The new legislation was passed in February, to ensure that the state of Missouri, and its citizens, are properly protected in case of unlawful practices by oil and gas well operators.
Like all surety bonds, the bond for Missouri oil and gas well operators creates an extra layer of accountability for businesses. If the state of Missouri suffers damages from an oil or gas well operator, they can be compensated according to the bond terms. Well operators found to be in violation of the Missouri laws and statutes, particularly Chapter 259 of the Missouri Revised Statutes, that govern their business could face a bond claim, which can have grave consequences for their finances and reputation.New Bond Amounts
Like before, all oil and gas well operators in Missouri must be licensed, and must also post a surety bond within 30 days of applying for their license. However, the new rules have changed the bonding amounts, with exact requirements varying based on well size. Here’s a quick guide to the new bond minimums for single well operators:
0-500 ft.: $1,100
501-1000 ft.: $2,200
1,001-2,000 ft.: $3,300
2,001-5,000 ft.: $4,400
5,001+ ft.: $5,500 plus $2/foot beyond 5,001 feet
Blanket well operators can obtain one bond that covers multiple smaller wells. The exact amounts v...