The Oklahoma Bar Journal May 2024

Commission’s threat to force an operator to remediate pollution and plug a well or have their surety revoked is hollow if the operator can avoid the plugging by agreeing to forfeit a surety that is less than the plugging liability. It makes economic sense to forfeit a surety if the cost of compliance is more expensive. The operator will lose the ability to operate wells in Oklahoma, but that is only an incentive so long as the value of the wells they own is greater than their plugging liability. Once the operator has been found to be out of compliance with Commission regulations, the Commission can raise the operator’s surety; how ever, in many instances, the opera tor has already chosen to abandon their wells. Once an operator puts themselves in this position, there is no reason for them to pay any additional surety. While raising a surety decreases the likelihood an operator may plug their wells, the Commission has few other options to encourage responsible opera tion. If the Commission does not raise the surety, an operator would repeatedly abandon specific wells

Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff.

MAY 2024 | 31

THE OKLAHOMA BAR JOURNAL