Louisiana Administrative Code › Title 43 - NATURAL RESOURCES › Part I - Office of the Secretary › Subpart 2 - Oilfield Site Restoration › Chapter 23 - Oilfield Site Restoration Fund › Section I-2305 - Site-Specific Trust Accounts; Accounting Method

Current through Register Vol. 50, No. 6, June 20, 2024
A. Prior to the establishment of the first
				  site-specific trust account on any oilfield site, where there are one or more
				  wells associated with a transfer of ownership interest, any party to the
				  transfer may file an application with the secretary, on a form provided by the
				  department, requesting approval of a site-specific trust account based on a
				  site assessment estimate, for restoration of the site so transferred, in
				  compliance with oilfield site restoration under LAC 43:XIX.101 et
				  seq.
B. After a site-specific trust
				  account has been established on any oilfield site, including one or more wells,
				  any subsequent transfer of any interest in one or more wells included in the
				  account shall be reported to the secretary, on a form provided by the
				  department. The secretary shall review the reported transfer and determine
				  whether any modifications or adjustments to the account shall be made. Once a
				  site-specific trust account has been approved the secretary shall issue a
				  letter of determination to the transferror indicating that he shall be exempt
				  from liability in accordance with this Part.
C. Upon application to the department, on a
				  form provided by the department, by the seller and the purchaser of an oilfield
				  site transferred prior to August 15, 1993, subject to agreement by the
				  assistant secretary for the office of conservation, a site-specific trust
				  account may be established, or, a prior established private trust account may
				  be transferred to the oilfield site restoration fund. Any trust account being
				  transferred shall be subject to review and may be modified to meet the
				  requirements of these rules.
D.
				  Once a site-specific trust account has been established the secretary may
				  modify the funding requirements of the account at any time during the life of
				  the oilfield site, upon recommendation of the commission, the assistant
				  secretary, or upon his own determination, based upon changes in operation, site
				  conditions, or trust account status. After approval and establishment of a
				  site-specific trust account only the responsible party shall be liable for
				  payment of any modifications or adjustments required by the
				  secretary.
E. When a transfer of an
				  ownership interest (where there is an existing trust account), is reported to
				  the secretary, as required by this Part, the secretary may, after review,
				  determine, based on the nonsubstantial nature of the interest being transferred
				  or the adequacy of the trust account, that no adjustment or modification to the
				  existing trust agreement is necessary. If this occurs the secretary shall issue
				  a letter of determination to the transferror indicating that he shall be exempt
				  from liability in accordance with this Part.
F. The party or parties to a transfer who
				  propose to establish a site-specific trust account shall:
1. propose a funding schedule, based on the
				  site restoration assessment, which will fully fund the site restoration at the
				  end of the economic life of the oilfield site;
2. pay some contribution into the trust
				  account at the time of transfer and make quarterly payments into the trust
				  account throughout the economic life of the oilfield site.