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How much does an oil and gas well financial responsibility bond cost in Mississippi?
The Mississippi Board of Oil and Gas Board requires those who own or operate oil and/or gas wells to post a surety bond to legally work within the state. The required bond amounts vary which makes the premiums for these bonds also vary. The premium an applicant pays depends on their credit score. An applicant with excellent credit could pay as low as 1% of the total bond amount.
The amount for an oil and gas well financial responsibility bond depends on the depth of the well and are as follows:
- $20,000 if the depth is from 0 to 10,000 feet deep
- $30,000 if the depth is from 10,001-16,000 feet deep
- $60,000 if the depth is from 16,0001-or more feet deep
The Mississippi Oil and Gas board may increase the required bond amount if it sees fit. Applicants must verify their required bond amount with the state prior to bonding.
Call 1 (800) 308-4358 or submit a bond request to connect with our team of experts and get a personalized quote.
Why do I need this bond?
Mississippi oil and gas well surety bonds ensure that the principal (well operator) operates these wells in compliance with the provisions of the laws of the state and the rules, regulations and orders of the Oil and Gas Board. For example, all wells must adhere to regulations and have blowout preventers (BOPs) as a precautionary measures. The bond also covers the proper plugging of well or wells, the restoration of the surfaces of well or wells and the filing of all required notices and records with the board.
All rules and regulations can be found in the ”Mississippi State Oil and Gas Well Rule Book” link in the Additional Resources section below.
Don’t fall out of compliance with the laws of your state and industry! Begin the simple bonding process now.
What’s the fine print?
Mississippi oil and gas well bonds are in effect for one year then they must be renewed unless claimed against or canceled. However, the surety must give 120 days' written notice to the obligee before the cancellation is in effect.
Remember, oil and gas well bond premiums vary depending on the depth of a well so an applicant must communicate with the state to ensure the correct bond is purchased.
How to become an oil and gas well operator in Mississippi
To become a registered oil and gas well operator, applicants must:
- Fill out a performance bond application on the Mississippi Oil and Gas Board webpage
- Post a surety bond for the correct amount
- Pay $500 permit fee
The Mississippi Oil and Gas Board web page provides all the resources an applicant needs to become an oil and gas operator. The Mississippi Oil and Gas Board link below is to their homepage and the application can be found under the publications tab.