South Dakota increases oil & gas well performance bond amount


Signed by Gov. Dennis Daugaard on March 12, 2013, South Dakota SB 1 increases the performance and plugging bond amount required for oil and gas wells in the state.

Section 1 of the enrolled bill explains the change.

“45-9-15. Without limiting its general authority, the Board of Minerals and Environment may require, or may delegate to the secretary of environment and natural resources, specific authority to require the furnishing of a plugging and performance bond in the amount as follows:

(1) For wells at or less than fifty-five hundred feet in depth, an individual bond of ten thousand dollars per well drilled or a thirty thousand dollar blanket; or

(2) For wells more than fifty-five hundred feet in depth, and individual bond of fifty thousand dollars per well drilled, or one hundred thousand dollars blanket,

with good and sufficient surety, conditioned for the performance of the duty to plug each dry or abandoned well, to restore the premises, insofar as possible, to the condition that existed before the filing of the application to drill; and conditioned on the proper performance of all of the requirements of §§45-9-5 to 45-9-18, inclusive. The condition of the bond insofar as it relates to the restoration of the surface is deemed to have been compiled with if the landowner or lessee and the producer or circumstances require.”

If you need a surety bond in South Dakota or any other state, you can speak with a surety specialist by calling 1 (800) 308-4358 Monday through Friday from 7 a.m. to 7 p.m. CST. Or, you can fill out our online contact form, and an expert surety specialist will contact you to walk you through the bonding process.

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