Mississippi Code 1972 (2023) › Title 53 - OIL, GAS, AND OTHER MINERALS (§§ 53-1-1 — 53-11-33) › Chapter 11 - MISSISSIPPI GEOLOGIC SEQUESTRATION OF CARBON DIOXIDE ACT (§§ 53-11-1 — 53-11-33) › Section 53-11-15 - Board order provisions

(1)
The order issued by the State Oil and Gas Board shall be fair and reasonable under all of the circumstances and shall protect the rights of interested parties and shall include:
(a)
A description of the geographical area and a description of the reservoirs or of any portion or portions or combinations thereof affected which together constitute and are herein termed the "unit area" of the geologic storage facility.
(b)
A statement of the nature of the operations contemplated.
(c)
A provision for:
(i)
access to and use of a reasonable amount of the surface area within the unit area by the storage operator and his agents in connection with constructing, equipping, operating, maintaining and terminating operations of the geologic sequestration facility; and
(ii)
payment of the reasonable costs of compensable damages to the surface and reasonable consideration for use of the surface area.
(d)
If oil or gas or both are expected to be produced in connection with operating a unit area as a geologic sequestration facility and the reservoir is being operated under a board order obtained pursuant to the requirements of Section
53-3-101
et seq., the geologic sequestration facility may be operated under the existing plan of unitization approved by the owners therein provided that the unit operator:
(i)
provides a method approved by the board for winding down oil and gas operations for the transition to a carbon dioxide injection only operation; and
(ii)
obtains the approval of a majority interest of the surface interest, on the basis of, and in proportion to, the surface acreage content of the unit area, prior to the termination of oil and gas production.
(e)
If oil or gas or both are expected to be produced in connection with operating the geologic sequestration facility and the reservoir has not formerly been unitized by board order under Section
53-3-101
et seq., the order shall include:
(i)
A formula for the allocation among the separately owned tracts in the geologic sequestration unit area of all the oil or gas, or both, produced and saved from the geologic sequestration unit area, and not required in the conduct of such operation, which formula must expressly be found reasonably to permit persons otherwise entitled to share in or benefit by the production from the separately owned tracts to receive, in lieu thereof, their fair, equitable and reasonable share of the unit production. A separately owned tract's fair, equitable and reasonable share of the unit production shall be that proportionate part of unit production that the contributing value of the tract for oil and gas purposes in the geologic sequestration unit area and its contributing value to the unit bears to the total of all like values of all tracts in the unit, taking into account all pertinent engineering, geological and operating factors that are reasonably susceptible of determination.
(ii)
A provision for adjustment among the owners of the geologic sequestration unit area, not including royalty owners, of their respective investment in wells, tanks, pumps, machinery, materials, equipment and other things and services of value attributable to the unit operations. The amount to be charged to unit operations for any such item shall be determined by a majority of the owners of the geologic sequestration unit area and a majority of the working owners of the oil and/or gas interests in the geologic sequestration unit area, not including royalty owners, but if the owners of the geologic sequestration unit area and working owners of the oil or gas, or both oil and gas interests, not including royalty owners, are unable to agree upon the amount of the charges, or to agree upon the correctness thereof, the board shall determine the charges after due notice and hearing upon the application of any interested party. The amount charged against the owner of a separately owned tract shall be considered an expense of unit operation chargeable against the tract. The adjustments provided for in this subparagraph (ii) may be treated separately and handled by agreements separate from the unitization agreement.
(iii)
A provision that the costs and expenses of unit operations dedicated to producing oil and gas, including investment past and prospective, shall be borne by the working owners of each tract, who in the absence of unit operation would be responsible for the expenses of developing and operating the oil and gas pools or reservoirs, in the same proportion that the tracts share in unit production. Each working owner's interest in the oil or gas or both expected to be produced in connection with operating the geologic sequestration unit area shall be responsible for the working owner's proportionate share thereof, and the unit operator shall have a lien thereon to secure payment of the working owner's share together with interest at the legal rate. A transfer or conversion of any working owner's interest or any portion thereof, however accomplished after the effective date of the order creating the unit, shall not relieve the transferred interest of the operator's lien on the interest for the cost and expense of unit operations, past or prospective.
(iv)
The designation of, or a provision for the selection of a successor to, the storage operator.
(v)
A provision that the conduct of all unit operations by the storage operator and the selection of a successor to the storage operator shall be governed by the terms and provisions of the geologic sequestration facility agreements.
(vi)
A determination of, or a provision for determining, the time the oil and gas unit operation is to become effective.
(vii)
A determination of, or a provision for determining, the manner in which, and the circumstances under which, the unit oil and gas operation shall terminate and the geologic sequestration facility will no longer be considered productive of oil and gas or other commercial minerals and the geologic sequestration facility will be operated solely for the injection of carbon dioxide.
(viii)
A requirement that all oil or gas, or both oil and gas, contained in a unit area shall be produced and sold as rapidly as possible without decreasing the ultimate recovery of oil or gas, or both, or causing damage to the reservoir.
(2)
If oil or gas, or both, are being produced as an enhanced recovery project operating under a board order obtained pursuant to the requirements of Section
53-3-101
et seq., utilizing the injection of carbon dioxide for enhanced oil or gas recovery, the board, upon application by the unit operator, may make an order recognizing the incidental sequestration of carbon dioxide that is occurring during its enhanced oil or gas recovery project without requiring the project to qualify as a geologic sequestration facility or otherwise be subject to the provisions of this chapter.
Laws, 2011, ch. 437, § 8, eff. 3/23/2011.