18 AAC 75.236. Amount and evidence of financial responsibility; onshore production facilities

(a) In addition to the other applicable requirements of this chapter, for an onshore production facility, the amount of financial responsibility required is based on maximum daily production of oil, measured in barrels per day. "Maximum daily production" means the highest amount of oil to be produced at a facility in one day during the period for which application is made.

(b) For an onshore production facility that is taken out of service, or suspended under 20 AAC 25, but that is not closed or abandoned, the amount of financial responsibility required is the most recent amount of financial responsibility required under this chapter, and that amount will continue to be required until production resumes, at which time the owner or operator shall determine maximum daily production under (a) of this section.

(c) The owner or operator shall, when submitting an application under 18 AAC 75.205 or 18 AAC 75.225, submit a notarized statement certifying that the maximum daily production of oil at a facility during the period for which application is made will be

(1) over 10,000 barrels a day;

(2) over 5,000 barrels a day, but less than 10,000 barrels a day;

(3) over 2,500 barrels a day but less than 5,000 barrels a day; or

(4) 2,500 or less barrels a day.

(d) With the certification submitted under (c) of this section, the owner or operator shall submit to the department a description of how the owner or operator determined the maximum daily production.

(e) The owner or operator shall notify the department in writing at its Juneau office of a change in production that would alter the certification submitted under (c) of this section within 30 days after the operator has knowledge of the change or knowledge of the impending change, whichever occurs first.

(f) If the department finds that the maximum daily production is or may be higher than that certified under (c) or reported under (e) of this section, the department will require the owner or operator to provide proof within 20 days that the amount certified or reported is correct. If the owner or operator fails to provide proof under this subsection that is satisfactory to the department, or fails to report a change under (e) of this section, the department will, in its discretion, deny or revoke its approval of the proof of financial responsibility.

(g) For purposes of this section, "production" has the meaning given "regular production" in AS 31.05.170 ; however, the term "production facility" retains the meaning given in 18 AAC 75.990.

History: Eff. 12/8/95, Register 136; am 11/27/2002, Register 164

Authority: AS 46.03.020

AS 46.04.040

AS 46.04.070

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