Full Text of SB2696 93rd General Assembly
SB2696 93RD GENERAL ASSEMBLY
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93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004 SB2696
Introduced 2/4/2004, by J. Bradley Burzynski SYNOPSIS AS INTRODUCED: |
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765 ILCS 530/2 |
from Ch. 96 1/2, par. 9652 |
765 ILCS 530/4 |
from Ch. 96 1/2, par. 9654 |
765 ILCS 530/6 |
from Ch. 96 1/2, par. 9656 |
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Amends the Drilling Operations Act. Adds the production and storage of methane gas to the definition of "drilling operations". Defines "agricultural production". Provides that the notice to the owner include a statement advising the surface owner that he or she may have a right to damages and advising the surface owner to seek legal counsel. Provides that a surface owner shall be entitled to reasonable compensation from the operator for damages to agricultural production and income caused by the drilling of a new well or by subsequent productions on the property. Provides that a surface owner shall be entitled to compensation for the diminution in value, if any, of the surface lands and other property after completion of the surface disturbance, the cost of repair of personal property, and lost use of and access to the surface owner's land. Effective immediately.
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A BILL FOR
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SB2696 |
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| AN ACT concerning drilling operations.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Drilling Operations Act is amended by | 5 |
| changing Sections 2, 4,
and
6 as follows:
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| (765 ILCS 530/2)
(from Ch. 96 1/2, par. 9652)
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| Sec. 2. As used in this Act:
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| (a) "Person" means any natural person, corporation, firm, | 9 |
| partnership,
venture, receiver, trustee, executor, | 10 |
| administrator, guardian, fiduciary or
other representative of | 11 |
| any kind and includes any government or any
political | 12 |
| subdivision or agency thereof;
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| (b) "Drilling operations" means the drilling, deepening or | 14 |
| conversion of
a well for oil or gas production, including the | 15 |
| production and storage of
methane gas, core hole or drill hole | 16 |
| for a stratigraphic
test;
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| (c) "Entry" means the moving upon the surface of land with | 18 |
| equipment to
commence drilling operations, but shall not | 19 |
| include entry for the survey
for or ascertaining or | 20 |
| identification of a well location;
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| (d) "Operator" means the person, whether the owner or not, | 22 |
| who applies
for or holds a permit for drilling operations or | 23 |
| who is named as the
principal on a bond for a permit for a well | 24 |
| that was issued by the
Department of Natural Resources;
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| (e) "Surface owner" means the person in whose name the | 26 |
| surface of the
land on which drilling operations are | 27 |
| contemplated, and who is assessed for
purposes of taxes imposed | 28 |
| pursuant to the Property Tax Code according to the
records of | 29 |
| the assessor of the county where the land
is located as | 30 |
| certified by said assessor;
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| (f) "Assessor" means the supervisor of assessments, board | 32 |
| of assessors,
or county assessor, as the case may be, for the |
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| county in which the land is
located;
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| (g) "Production operation" means the operation of a well | 3 |
| for the
production of oil or gas including all acts, | 4 |
| structures, equipment, and
roadways necessary for such | 5 |
| operation;
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| (h) "New well" means a well that is spudded after the | 7 |
| effective date of
this Act and does not utilize any part of a | 8 |
| well bore or drilling location
that existed prior to the | 9 |
| effective date of this Act;
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| (i) "Completion of the well" means completion of those | 11 |
| processes
necessary before production occurs, including the | 12 |
| laying of flow lines and
the construction of the tank battery. | 13 |
| If the well is not productive, the
date of completion of the | 14 |
| well is the day it is plugged and abandoned.
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| (j) "Agricultural production" means the production of any | 16 |
| growing grass,
crops, or trees attached to the surface of the | 17 |
| land, whether or not the grass,
crops, or trees are to be sold | 18 |
| commercially, and the production of any farm
animals, whether | 19 |
| or not the animals are to be sold commercially.
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| (Source: P.A. 88-670, eff. 12-2-94; 89-445, eff. 2-7-96.)
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| (765 ILCS 530/4) (from Ch. 96 1/2, par. 9654)
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| Sec. 4. Notice.
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| (a) At least 30 days prior
Prior to commencement of the | 24 |
| drilling of a well, the operator shall
give written notice to | 25 |
| the surface owner of the operator's intent to commence
drilling | 26 |
| operations.
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| (b) The operator shall, for the purpose of giving notice as | 28 |
| herein
required, secure from the assessor's office within 90 | 29 |
| days prior to the
giving of the notice, a certification which | 30 |
| shall identify the person in
whose name the lands on which | 31 |
| drilling operations are to be commenced and who
is assessed at | 32 |
| the time the certification is made. The written certification
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| made by the assessor of the surface owner shall be conclusive | 34 |
| evidence of
the surface ownership and of the operator's | 35 |
| compliance with the provisions of
this Act.
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| (c) The notice required to be given by the operator to the | 2 |
| surface owner
shall identify the following:
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| (1) The location of the proposed entry on the
surface | 4 |
| for drilling operations, and the date on or after which | 5 |
| drilling
operations shall be commenced.
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| (2) A photocopy of the drilling application to the | 7 |
| Department
of Natural Resources for
the well to be drilled.
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| (3) The name, address and telephone number of the | 9 |
| operator.
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| (3.5) A statement advising the surface owner that he or | 11 |
| she may have a right to damages and advising the surface | 12 |
| owner to seek legal counsel.
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| (4) An offer to discuss with the surface owner those | 14 |
| matters set forth
in Section 5 hereof prior to commencement | 15 |
| of drilling operations.
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| (5) If the surface owner elects to meet the operator, | 17 |
| the surface owner
shall request the operator to schedule a | 18 |
| meeting at a mutually agreed time
and place within the | 19 |
| limitations set forth herein. Failure of the surface
owner | 20 |
| to contact the operator at least 5 days prior to the | 21 |
| proposed
commencement of drilling operations shall be | 22 |
| conclusively deemed a waiver
of the right to meet by the | 23 |
| surface owner.
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| (6) The meeting shall be scheduled between the hours of | 25 |
| 9:00 in the
morning
and the setting of the sun of the same | 26 |
| day and shall be at least 3 days prior
to commencement of | 27 |
| drilling operations. Unless agreed to otherwise, the
place | 28 |
| shall be located within the county in which drilling | 29 |
| operations are
to be commenced where the operator or his | 30 |
| agent shall be available to
discuss with the surface owner | 31 |
| or his agent those matters set forth in Section
5 hereof.
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| (7) The notice herein required shall be given to the | 33 |
| surface owner by
either:
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| (A) certified mail addressed to the surface owner | 35 |
| at the address shown
in the certification obtained from | 36 |
| the assessor, which shall be postmarked
at least 10 |
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| days prior to the commencement of drilling operations; | 2 |
| or
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| (B) personal delivery to the surface owner at least | 4 |
| 8 days prior to the
commencement of drilling | 5 |
| operations.
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| (C) Notice to the surface owner as defined in this | 7 |
| Act shall be deemed
conclusive notice to the record | 8 |
| owners of all interest in the surface.
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| (Source: P.A. 89-445, eff. 2-7-96.)
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| (765 ILCS 530/6)
(from Ch. 96 1/2, par. 9656)
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| Sec. 6. Compensation of surface owners for drilling and | 12 |
| producing
operations and duties after cessation of production.
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| (A) The surface owner shall be entitled to reasonable | 14 |
| compensation from
the operator for damages to agricultural | 15 |
| production and income, growing
crops, trees, shrubs, fences, | 16 |
| roads,
structures, improvements and livestock thereon caused | 17 |
| by the drilling of a new
well , including compensation for the | 18 |
| diminution in value, if any, of the
surface lands and other | 19 |
| property after completion of the surface disturbance,
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| determined according to the actual use made thereof by the | 21 |
| surface owner
immediately prior to the commencement of the | 22 |
| drilling operations, the cost of
repair of personal property up | 23 |
| to the value of replacement by personal property
of like age, | 24 |
| wear, and quality, and lost use of and access to the surface
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| owner's land . The surface owner shall also be entitled to | 26 |
| reasonable
compensation
from the operator for subsequent | 27 |
| damages to agricultural production and
income, growing crops, | 28 |
| trees, shrubs,
fences, roads, structures, improvements and | 29 |
| livestock thereon caused by
subsequent production operations | 30 |
| of the operator thereon , including
compensation for the | 31 |
| diminution in value, if any, of the surface lands and
other
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| property after completion of the surface disturbance, | 33 |
| determined according to
the actual use made thereof by the | 34 |
| surface owner immediately prior to the
commencement of the | 35 |
| drilling operations, the cost of repair
of personal property up |
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| to the value of replacement by personal property of
like age, | 2 |
| wear, and quality, and lost use of and access to the surface | 3 |
| owner's
land . The surface
owner shall also be entitled to | 4 |
| reasonable compensation for all negligent
acts of operator that | 5 |
| cause measurable damage to the productive capacity of
the soil. | 6 |
| In addition, the operator shall not utilize any more of the
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| surface estate than is reasonably necessary for the | 8 |
| exploration, production
and development of the mineral estate.
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| (B) The compensation required pursuant to paragraph (A) | 10 |
| above shall be
paid in any manner mutually agreed upon by the | 11 |
| operator and the surface
owner, but the failure to agree upon, | 12 |
| or make the compensation required,
shall not prevent the | 13 |
| operator from commencement of drilling operations;
provided, | 14 |
| however, that operator shall tender to the surface owner | 15 |
| payment by
check or draft in accordance with the provisions | 16 |
| herein no later than 90 days
after completion of the well. The | 17 |
| surface owner's remedy shall be an
action for compensation in | 18 |
| the circuit court in which the lands or the
greater part | 19 |
| thereof are located on which drilling operations were
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| conducted; provided, however, that if operator fails to tender | 21 |
| payment
within the 90-day period or if the tender is not | 22 |
| reasonable, surface owner
shall be entitled to reasonable | 23 |
| compensation as provided herein as well as
attorney's fees.
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| If operator relies on a third party appraiser or fair | 25 |
| market value, such
amount shall be conclusively deemed to be | 26 |
| reasonable, and there shall be no
award of attorney's fees.
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| (C) In conjunction with the plugging and abandonment of any | 28 |
| well, the
operator shall restore the surface to a condition as | 29 |
| near as practicable to
the condition of the surface prior to | 30 |
| commencement of drilling operations;
provided, however, that | 31 |
| the surface owner and operator may waive this
requirement in | 32 |
| writing, subject to the approval of the Department of Natural
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| Resources that the waiver is in accordance with its
rules.
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| (D) Where practicable and absent a written agreement to the | 35 |
| contrary
with the surface owner, all flow lines and other | 36 |
| underground structures
must be buried to a depth not less than |
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| 36 inches from the surface.
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| (Source: P.A. 89-445, eff. 2-7-96.)
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