§ 35-11-316 — Unitization of geologic sequestration sites; hearings on application, order; modifications

(a) Upon receipt of an application under W.S. 35-11-315,
the Wyoming oil and gas conservation commission shall promptly
set the matter for hearing, and in addition to any notice
otherwise required by law or the commission's rules, shall cause
the applicant to give notice of the hearing, specifying the time
and place of hearing, and describing briefly its purpose and the
land and pore space affected, to be mailed by certified mail at
least thirty (30) days prior to the hearing to all persons whose
names and addresses are required to be listed in the
application.
(b) After considering the application and hearing the
evidence offered in connection therewith, the Wyoming oil and
gas conservation commission shall enter an order setting forth
the following findings and approving the proposed plan of
unitization and proposed operating plan, if any, if the
commission finds that:
(i) The material allegations of the application are
substantially true;
(ii) The purposes specified in W.S. 35-11-314 will be
served by granting the application;
(iii) The application outlines operations that will
comply with applicable underground injection control class VI
well permits, draft permits or any applications for permits and
any other environmental requirements. The commission may rely on
a class VI well permit issued by the department to make the
findings required by this paragraph;
(iv) Granting the application will facilitate the use
and production of Wyoming energy resources or will utilize pore
space for geologic sequestration;
(v) The quantity of pore space storage capacity, and
method used to determine the quantity of pore space storage
capacity allocated to each separately owned tract within the
unit area represents, so far as can be practically determined,
each tract's actual share of the pore space included within the
unit area;
(vi) The method for the allocation of economic
benefits provided by the use of pore space within the unit area
between pore space owners; and between pore space owners and the
unit operator or others is fair and reasonable. For purposes of
this paragraph, federal injection fees, federal lease payments
and other consideration derived from federal leases shall not be
considered;
(vii) The method for providing for economic benefits
from the use of pore space in the unit area is fair and
equitable and is reasonably designed to maximize the use of the
pore space;
(viii) Other requirements specified by rules or
regulations adopted by the oil and gas conservation commission
have been met.
(c) No order of the Wyoming oil and gas conservation
commission authorizing the commencement of unit operations shall
become effective until the plan of unitization has been signed
or in writing ratified or approved by those persons who own at
least eighty percent (80%) of the pore space storage capacity
within the unit area. If such consent has not been obtained at
the time the commission's order is made, the commission shall,
upon application, hold supplemental hearings and make findings
as may be required to determine when and if the consent will be
obtained. The commission shall require the applicant to give
notice of a supplemental hearing by regular mail at least thirty
(30) days prior to the hearing to each person owning interests
in the pore space in the proposed unit area whose name and
address was required by W.S. 35-11-315(a) to be listed in the
application for the unit operations. If the required percentages
of consent have not been obtained within a period of six (6)
months from and after the date on which the order of approval is
made, the order shall be ineffective and revoked by the
commission, unless, for good cause shown, the commission extends
that time. Any interested person may file an application with
the Wyoming oil and gas conservation commission requesting an
order applicable only to the proposed unit area described in the
application which shall provide for the percentage of approval
or ratification to be reduced from eighty percent (80%) to
seventy-five percent (75%). The application shall contain the
information required by W.S. 35-11-315(a) and any order of the
commission entered pursuant to the application shall comply with
subsection (b) of this section. Notice of the hearing on the
application shall be given in the same manner and to the same
persons as required by subsection (a) of this section. If the
commission finds that negotiations were being conducted since
July 1, 2009, or have been conducted for a period of at least
nine (9) months prior to the filing of the application, that the
applicant has participated in the negotiations diligently and in
good faith, and that the percentage of approval or ratification
required by this subsection cannot be obtained, the commission
may reduce any percentage of approval or ratification required
by this section from eighty percent (80%) to seventy-five
percent (75%). The order shall affect only the unit area
described in the application and shall operate only to approve
the proposed plan of unitization and proposed operating plan and
to reduce the required percentage of approval or ratification
thereof and shall not change any other requirement contained in
this section.
(d) From and after the effective date of an order of the
Wyoming oil and gas conservation commission entered under the
provisions of this section, the operation of the unit area
defined in the order by persons other than the unit operator or
persons acting under the unit operator's authority, or except in
the manner and to the extent provided in the plan of unitization
approved by the order, shall be unlawful and is hereby
prohibited.
(e) Unless otherwise provided in this section, an order
entered by the Wyoming oil and gas conservation commission under
this section may be amended in the same manner and subject to
the same conditions as an original order or previous agreement:
provided, no amendatory order shall change the assignments of
pore space storage capacity between existing pore space owners
in the unit area as established by the original order or
previous agreement, except with the written consent of those
persons who own at least eighty percent (80%) of the pore space
storage capacity in the unit area, nor change any allocation of
costs as established by the original order or previous
agreement, except with the written consent of those persons who
own at least eighty percent (80%) of the unit pore space storage
capacity. If consent has not been obtained at the time the
commission order is made, the commission shall, upon
application, hold supplemental hearings and make findings as may
be required to determine when and if such consent will be
obtained. The commission shall require the applicant to give
notice of a supplemental hearing by regular mail at least thirty
(30) days prior to the hearing to each person owning interests
in the unit area whose name and address was required by the
provisions of W.S. 35-11-315(a)(iii) to be listed in the
application for the unit operations. If the required
percentages of consent have not been obtained within a period of
six (6) months from and after the date on which the order of
approval is made, the order shall be ineffective and revoked by
the commission, unless, for good cause shown, the commission
extends that time. Any interested person may file an
application with the Wyoming oil and gas conservation commission
requesting an order applicable only to the unit area described
in the application which shall provide for the percentage of
approval or ratification to be reduced from eighty percent (80%)
to seventy-five percent (75%). The application shall contain the
information required by W.S. 35-11-315(a) and any order of the
commission entered pursuant to the application shall comply with
subsection (b) of this section. Notice of the hearing on the
application shall be given in the same manner and to the same
persons as required by subsection (a) of this section. If the
commission finds that negotiations were being conducted since
July 1, 2009 or have been conducted for a period of at least
nine (9) months prior to the filing of the application, that the
applicant has participated in the negotiations diligently and in
good faith, and that the percentage of approval or ratification
required by this subsection cannot be obtained, the commission
may reduce any percentage of approval or ratification required
by this section from eighty percent (80%) to seventy-five
percent (75%). The order shall affect only the unit area
described in the application and operate only to reduce the
required percentage of approval or ratification necessary for
amending the assignment of pore space and shall not change any
other requirement contained in this section.
(f) The Wyoming oil and gas conservation commission, upon
its own motion or upon application, and with notice and hearing,
may modify its order regarding the operation, size or other
characteristic of the unit area in order to prevent or assist in
preventing a substantial inequity resulting from operation of
the unit, provided that no such modification may amend any
permit issued under W.S. 35-11-313.
(g) Any owner of pore space within a geologic
sequestration site who has not been included within a
unitization application or order authorizing a unit under this
section, may petition for inclusion in the unit area. The
petition shall be filed with the Wyoming oil and gas
conservation commission and shall describe the petitioner's
legal entitlement to the pore space, the location of the pore
space, whether the pore space is included within any permitting
area applicable to the unit area and the bases for inclusion in
the unit area. The petition shall be accompanied by a deposit
of money sufficient to pay all costs of the inclusion
proceedings. The commission shall require the petitioner to
provide notice of the filing of the petition to all persons
specified in the application for the unit area under W.S. 35-11-
315(a). The notice required under this subsection shall state
the filing of the petition, the name of the petitioner, the
location of the pore space, the action sought by the petitioner
and any other information required by rule of the commission.
Upon receipt of the petition and the provision of notice by the
petitioner, the commission shall publish notice of a hearing,
which shall describe how all persons specified in an application
submitted under W.S. 35-11-315(a) may appear at a specified time
and place and show cause, in writing or as otherwise provided by
rules of the commission, why the petition should not be granted.
The commission at the time and place mentioned in the notice
shall proceed to hear the petition and all objections thereto
and shall thereafter grant or deny the petition. The filing of
the petition shall be deemed and taken as an assent by each and
all petitioners to the inclusion in the unit of the pore space
mentioned in the petition or any part thereof. If the petition
is granted, the petitioner shall be considered to have been a
member of the unit since its inception and, upon the payment of
any costs paid by unit members, shall be entitled to a
proportionate share of all economic benefits received by unit
members since the inception of the unit provided that no unit
modification affects any permit issued under W.S. 35-11-313.
The oil and gas conservation commission shall adopt rules or
orders providing for the fair and equitable determination of
pore space storage capacity for each successful petitioner and
the means by which successful petitioners shall be paid the
economic benefits to which they are entitled under this
subsection, including, if necessary, a reallocation of economic
benefits among unit members.
(h) A certified copy of any order of the Wyoming oil and
gas conservation commission entered under the provisions of this
section shall be entitled to be recorded in the land records of
the county clerk for the counties where all or any portion of
the unit area is located, and the recordation shall constitute
notice thereof to all persons.
(j) No provision of W.S. 35-11-314 through 35-11-319 shall
be construed to confer on any person the right of eminent domain
and no order for unitization issued under this section shall act
so as to grant to any person the right of eminent domain.
(k) No order for unitization issued under this section
shall:
(i) Act so as to grant any person a right of use or
access to a surface estate if that person would not otherwise
have such a right;
(ii) Diminish, impair or otherwise alter the
dominance of the mineral estate over the surface estate and pore
space interests;
(iii) Prohibit a mineral interest owner from
developing the owner's minerals above or below the unit area.
(m) Orders for unitization issued under this section may
accommodate and provide for the use of horizontal or directional
wells that may penetrate the pore space of separate pore space
estates for geologic sequestration purposes within the unit
area.