Okla. Stat. tit. 27A, § 27A-3-5-107

— Application — Notice — Findings — Order.

A. The Corporation Commission, upon filing of an appropriate

application and following notice and hearing regarding the

application, shall have the jurisdiction to create a CO storage unit

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as part of a CO sequestration facility and order the aggregation and

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communitization of the pore space within an approved reservoir in

designated tracts of land for the injection and storage of CO in

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such approved reservoir.

B. An application to create a CO storage unit may be filed by a

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party owning the rights to inject and store CO in the pore space of

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the approved reservoir in at least sixty-three percent (63%) of the

tracts of land to be included in the CO storage unit based on the

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surface acres of such unit. The application shall include:

1. A map or plat of the tracts of land to be included in the

proposed CO storage unit; and

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2. A plan of operations for such proposed CO storage unit,

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which shall include, but not be limited to, an accounting procedure,

the method, formula, or other basis by which the benefits of the CO

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storage unit shall be shared, and the procedures to be followed for

invoicing and paying the costs of the CO storage unit.

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C. Notice of an application to create a CO storage unit shall

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be served, at least fifteen (15) days prior to the hearing on the

merits of such application, by personal service or by mail, return

receipt requested, on:

1. All owners of the right to inject and store CO in the pore

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space of the approved reservoir underlying the tracts of land to be

included in the CO storage unit;

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2. All owners of the surface of such tracts of land to be

included in the CO storage unit; and

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3. All owners of oil and gas working interests in the mineral

estate in such approved reservoir underlying such tracts of land to

be included in the CO storage unit, including mineral owners in such

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approved reservoir in such tracts of land who have retained and have

not conveyed away their working interests under any oil and gas

leases, pooling orders, or otherwise.

An affidavit of service or mailing showing that the above-

described notice has been completed shall be filed with the

Commission prior to a hearing on the merits of the application to

create the CO storage unit.

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D. Notice of an application to create a CO storage unit shall

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be published two times, with one such publication being at least

thirty (30) days prior to the hearing on the merits of such

application and the second such publication being at least fifteen

(15) days prior to such hearing, in a newspaper of general

circulation published in Oklahoma County and in a newspaper of

general circulation published in the county or counties in which the

CO storage unit is to be located. Proof of publication showing that

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the above-described notice has been properly published shall be

filed with the Commission prior to a hearing on the merits of the

application to create the CO storage unit.

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E. In creating a CO storage unit, the Commission shall find and

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determine:

1. That the applicant has the required percentage ownership of

the right to inject and store CO in the pore space of the approved

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reservoir in the tracts of land to be included in the CO storage

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unit;

2. That the pore space in the approved reservoir in the tracts

of land to be included in the CO storage unit is of such a nature or

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character that CO may be effectively, efficiently, and safely

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injected into and stored in such pore space;

3. That the injected CO will be confined to the pore space of

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such approved reservoir in the tracts of land to be included in the

CO storage unit and that the CO injected into and stored in the

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pore space of such approved reservoir in such tracts of land will
h a nature or

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character that CO may be effectively, efficiently, and safely

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injected into and stored in such pore space;

3. That the injected CO will be confined to the pore space of

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such approved reservoir in the tracts of land to be included in the

CO storage unit and that the CO injected into and stored in the

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pore space of such approved reservoir in such tracts of land will

not escape and enter any other geologic interval or lands outside of

the CO storage unit;

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4. That the injection and storage of CO in the pore space of

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such approved reservoir in the tracts of land to be included in the

CO storage unit will not adversely affect any existing oil and gas

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production from any reservoir;

5. That the injection and storage of CO in the pore space of

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such approved reservoir in the tracts of land to be included in the

CO storage unit will not adversely affect or prohibit any potential

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future oil or gas production from such approved reservoir within the

tracts of land included in the CO storage unit;

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6. That the area to be included in the CO storage unit is of

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sufficient size and shape to contain and hold all of the CO

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anticipated to be injected into and stored in the CO storage unit,

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taking into account the extent of the plume which will be created by

such injection;

7. That the proposed operations of the CO storage unit will be

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such as to safely handle, receive, process, compress, inject,

confine, and store in such approved reservoir in the tracts of land

to be included in the CO storage unit;

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8. That the operator of the CO storage unit is qualified to

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create, maintain, and conduct operations in such unit; and

Oklahoma Statutes - Title 27A. Environment and Natural Resources Page 378

9. That the proposed plan of operations is reasonable and

adequate for the operation of the CO storage unit.

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F. The Commission order creating the CO storage unit shall

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provide any owner of the right to inject and store CO in the pore

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space of the approved reservoir in the tracts of land included in

such unit the following:

1. The right to be a cost-bearing owner who participates in the

costs of and the benefits from such storage unit. The costs of the

CO storage unit to be borne by a party electing to be a cost-bearing

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owner in such unit shall include all the actual, necessary, and

reasonable costs of creating, equipping, maintaining, and operating

the CO storage unit. The Commission shall make provisions for the

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payment of such costs of the CO storage unit by the owners of the

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right to inject and store in such CO storage unit. Such costs shall

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not include any costs of capturing or transporting the CO that is

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injected into and stored in the CO storage unit, including the costs

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of any CO capture and compression equipment, CO pipelines

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transporting the CO to such CO storage unit, or any other equipment

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or pipelines used in connection with such capture or transportation;

or

2. The right to receive the fair market value for such owner’s

right to use such pore space for the injection and storage of CO ,

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including the fee for the injection and storage of CO in such CO

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storage unit. The fair market value of the right to inject and

store CO in the pore space of such approved reservoir shall be

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determined by the Commission, based on all relevant evidence

presented by the parties as to such fair market value, including,

but not limited to, arm’s length consummated transactions involving

the transfer of the right to use pore space for the injection and

storage of CO , taking into account any differences in the

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circumstances involved in any such consummated transaction, and the

specific circumstances involved in the proposed CO storage unit.

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The Commission shall make provisions for payment of the amounts

set forth above to the owners of the right to inject and store CO in

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transfer of the right to use pore space for the injection and

storage of CO , taking into account any differences in the

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circumstances involved in any such consummated transaction, and the

specific circumstances involved in the proposed CO storage unit.

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The Commission shall make provisions for payment of the amounts

set forth above to the owners of the right to inject and store CO in

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the pore space of the approved reservoir who elect or are deemed to

elect not to be cost-bearing owners in such CO storage unit. Any

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owner of the right to inject and store CO in the pore space of the

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approved reservoir who elects or is deemed to elect not to be a

cost-bearing owner in the CO storage unit shall relinquish by

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operation of law under the order creating the CO storage unit the

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right to inject and store CO in the pore space in the approved

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reservoir in the CO storage unit.

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G. The Commission order creating the CO storage unit shall

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establish:

1. The CO storage unit by defining and specifically describing

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the approved reservoir and the tracts of land included in the unit;

2. The operator of the CO storage unit;

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3. The plan of operations for the CO storage unit;

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4. The options to be granted to an owner of the right to use

the pore space in the approved reservoir to inject and store CO as

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prescribed in subsection F of this section;

5. The estimated costs of creating, equipping, maintaining, and

operating the CO storage unit and the provisions for the payment of

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such costs;

6. The procedures and safeguards to be followed for any owner

of oil and gas rights to drill through the CO storage unit for the

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purpose of producing oil or gas from another geologic interval;

7. Any other procedures or safeguards that may be deemed

necessary to ensure the safe operation of the CO storage unit; and

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8. The provisions for the termination of such CO storage unit,

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including the obligations concerning the plugging of any wells used

in connection with such unit and the remediation or restoration of

the surface of the lands used in the operation of such unit.

H. Upon creation of a CO storage unit, the operator of the CO

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storage unit may inject a CO stream into and store CO in the

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approved reservoir in the tracts of land included in such unit.

Operation on any part of the CO storage unit shall be considered

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operation on each separate tract of land in such CO storage unit.

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I. On and after the effective date of a Commission order

creating a CO storage unit, operation of any well injecting CO into

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the approved reservoir in the tracts of land included in such unit

shall be unlawful except as authorized by the order and plan of

operations for such unit. Notice of the creation of the CO storage

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unit shall be placed of record in each county in which the unit is

located.

J. Upon creation of a CO storage unit, the Commission shall

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retain jurisdiction over the unit, including the plan of operations

for the unit and the designation of the operator. Nothing in this

subsection shall preclude or impair the right of any affected party

to obtain through the district courts of this state any remedy or

relief available at law or in equity for injuries or damages

resulting from operation of a CO storage unit.

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K. 1. The Commission, upon the filing of a proper application,

may enlarge or reduce a CO storage unit. The application for

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enlargement or reduction of the CO storage unit shall set forth the

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reasons for such enlargement or reduction. An operator who seeks to

enlarge or reduce a CO storage unit shall comply with the minimum

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ownership requirements established in subsection B of this section

as applied to all the tracts of land to be included in the proposed

enlarged unit or reduced unit, whichever is applicable. Notice of
r reduction of the CO storage unit shall set forth the

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reasons for such enlargement or reduction. An operator who seeks to

enlarge or reduce a CO storage unit shall comply with the minimum

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ownership requirements established in subsection B of this section

as applied to all the tracts of land to be included in the proposed

enlarged unit or reduced unit, whichever is applicable. Notice of

an application to reduce a CO storage unit shall be given to the

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owners of the right to inject and store CO in the pore space of the

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approved reservoir in the unit.

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2. Notice of an application to enlarge a CO storage unit shall

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be given to:

a. the owners of the right to inject and store CO in the

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pore space of the approved reservoir in the CO storage

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unit and in the additional pore space underlying the

tracts of land to be added to such unit,

b. the owners of oil and gas working interests in the

mineral estate in the additional pore space to be

added to the unit, including mineral owners in the

additional pore space who have retained and have not

conveyed away their working interests under any oil

and gas leases, pooling orders or otherwise, and

c. the owners of the surface of the additional tracts of

land to be added to the unit. Notice of the

application to enlarge or reduce a CO storage unit

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shall be served and published in the same manner with

the same time periods as set forth in connection with

the application to create a CO storage unit.

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L. Subject to the provisions of Section 10 of this act, the CO

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injected into and stored in the pore space of the approved reservoir

in a CO storage unit shall be the property of the cost-bearing

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owners in such unit. However, upon termination of a CO storage

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unit, the CO injected into the pore space of the approved reservoir

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of the CO storage unit may remain in such pore space and need not be

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removed.

M. The Commission may promulgate rules to effectuate the

provisions of this section.

N. Any party aggrieved by any order or determination of the

Commission made pursuant to this section may appeal the order or

determination to the Supreme Court in the same manner as provided in

Section 113 of Title 52 of the Oklahoma Statutes and any other

applicable statutes relating to appeals of orders by the Commission.