An Application for Permit shall be filed with the Division of Oil and Gas before a well is drilled, deepened or re-opened for the production of natural gas, crude oil, water supply for enhanced recovery, or injection into a reservoir for the purpose of enhanced recovery. A permit is also required to drill stratigraphic test hole or operate any well under violation in which the previous operator's bond has been forfeited. The permit application is to include a fee of $350 made payable to the Kentucky State Treasurer; three copies of the well plat and appropriate bonding.
The Division of Oil and Gas requires well operators to post DANGER signs in a prominent location on all storage facilities and tank batteries that are active or abandoned. An approved sign may be obtained from the Kentucky Oil and Gas Association.
Typically a well will have three records that need to be submitted to the Division of Oil and Gas. The Affidavit of Well Log and Completion Report (Form OG-3), the Affidavit to Time and Manner of Plugging and Filling Well (Form OG-38), and if applicable a copy of the electric log. These documents will be reviewed by the Kentucky Division of Oil and Gas staff, entered into the Oil and Gas RBDMS database and forwarded to imaging for scanning and digital storage. Copies will also be forwarded to the Kentucky Geological Survey for incorporation into the KGS publically available database.
Temporary Abandonment Permits
A shut-in oil, gas or injection well may be classified as Temporarily Abandoned (TA) after the operator submits a Temporary Abandonment Permit (OG-12) to the Division of Oil and Gas and after an inspection to verify wellhead integrity and the casing/cementing records warrant the issuance of the TA permit. The Division administrative staff will review the operational history of the operator as well as any agreement or abatement plans executed with the Division prior to granting approval of the TA permit. Temporary Abandonment permits may be granted for up to a period of two (2) years and may be renewed at the discretion of the Division; renewal will require the well operator to file another TA permit.
Approximately 13,000 known abandoned wells are found in Kentucky's oil and gas fields. Many more "unknown" oil and gas wells are present. The Testing Permit Program (KRS 353.730) allows an operator to acquire a Testing Permit ($25 fee) to enter a well for 60 days to determine the well's ability to produce gas, oil and/or water. After testing, the operator reports to the Division of Oil and Gas with a Report of Investigation on the results of the testing. If the operator elects not to place the well under his bond, due to, for example, mechanical issues or unfavorable economics the well is returned to the State Plugging List for eventual plugging. If the operator wants to have the well placed under his bond, he will check the appropriate box on Page 2 of the Report of Investigation, establish a bond, and the well will be transferred to his bond. This program provides a very inexpensive vehicle for testing potentially economic abandoned wells, for finding previously unknown abandoned wells, and for getting abandoned wells either back in operation or properly plugged.
A vacuum permit is available if an operator wants to apply this technology to a well (805 KAR 1:040 Vacuums; use of). No fee is required. If another operator has a well within 1,000 feet of the applicant's well the offset operator needs to be notified by registered mail of the intent to apply vacuum in correlative strata. The Kentucky Division of Oil and Gas will hold the permit for a period of 10 days to receive and consider any objections. If no objections are received, the applicant will receive a letter from the Division of Oil and Gas granting an exemption from the vacuum prohibition.
Well Site Reclamation
Beginning in 1994, well site reclamation became required on all severed mineral leases to prevent excessive erosion after drilling, and at end of the well life cycle after the well has been properly plugged. This wellsite reclamation requirement was further expanded by the legislature in 2015 to require site reclamation plans on all new wells permitted after June 24, 2015. Site reclamation shall be performed in accordance with the plan submitted and approved at the time of the permit application. An inspector will make an on-site inspection at completion of drilling to confirm the site has been stabilized and seeded. At end of the well production life, another inspection of the reclaimed location shall be done after the area is restored, allowing ample time for vegetation to be established.