Section 53-11-11 - Protection of correlative rights(1) Upon application by an operator to unitize for a geologic sequestration facility in an oil or gas reservoir that is not unitized either under this chapter or by board order under the provisions of Section 53-3-103 or 53-3-155, after notice as provided in Section 53-3-115, the board shall hold a hearing to consider the operation of the reservoir for the storage of carbon dioxide to determine whether the predominant result of the injection operations will be the storage of carbon dioxide or will result in an increase in the ultimate recovery of oil or gas, or both, from the proposed geologic sequestration facility. After the hearing the board may:(a) Determine from the evidence that the reservoir has more value as a geologic sequestration facility than as an enhanced oil or gas recovery project, and as a result, the board shall enter an order for the operation of the unit as a geologic sequestration facility upon making the additional findings set forth in Section 53-11-13.(b) Determine from the evidence that the predominant result of the injection operations will be an increase in the ultimate recovery of oil or gas or both, and as a result, the board shall not approve the application for a geologic sequestration facility. However, this shall not prevent the board, upon application of the operator, from approving operation of an existing enhanced oil or gas recovery project simultaneously as a geologic sequestration project, recognizing the incidental storage of carbon dioxide under the provisions set forth in Section 53-11-15(1)(d).(2) Upon application by an operator to unitize for a geologic sequestration facility in any other nonoil, nongas or noncommercial mineral-bearing reservoir that needs to be unitized, after notice as provided, the board shall hold a hearing to consider the evidence, and shall enter an order for the operation of the reservoir as a geologic sequestration facility upon making the findings set forth in Sections 53-11-9(1) and 53-11-13.(3) An order requiring unit operations of a geologic sequestration facility shall be effective only when the unit for the geologic sequestration facility and the agreements incorporating the pertinent provisions of Section 53-11-15 have been signed, ratified, adopted or approved in writing by a majority interest of the surface interest, on the basis of, and in proportion to, the surface acreage content of the unit area, and, if separately owned, a majority interest of all rights of the subsurface reservoir, on the basis of and in proportion to the surface acreage content of the unit area, and the board has made a finding to that effect, either in the order or in a supplemental order.(4) If the board finds under Section 53-11-9(1)(e) that a reservoir has been substantially depleted of commercially recoverable quantities of oil or gas or other commercial minerals or that the reservoir has greater utility as a reservoir for carbon dioxide storage and that the remaining conditions of Section 53-11-9(1) have been satisfied; or if the board finds that a nonoil, nongas or noncommercial mineral-bearing reservoir satisfies the conditions of Section 53-11-9(1)(a) through (d) and all other conditions the board shall require have been satisfied, the board shall issue an order approving the reservoir for the injection and storage of carbon dioxide in connection with operation of a geologic sequestration facility. An order approving any geologic sequestration facility shall be effective only when the storage rights agreement has been signed, ratified, adopted or approved in writing by a majority interest of the surface interest, on the basis of, and in proportion to, the surface acreage content of the unit area under the terms of the order; and, if separately owned, a majority interest of all rights in the underground reservoir, on the basis of, and in proportion to, the surface acreage content of the unit area. If oil, gas or commercial minerals are expected to be produced and sold or used in connection with the geologic sequestration facility in a depleted oil, gas or commercial mineral-bearing reservoir, or such a reservoir that has greater utility as a geologic sequestration facility, then a majority interest of all working owners of such oil, gas or commercial minerals, on the basis of, and in proportion to, the surface acreage content of the unit area under the terms of the order, must also consent to the allocation of the production in writing before an order approving the geologic sequestration facility shall be effective.(5) In the event the required percentages set forth in this section have not signed, ratified or approved the respective agreements within twenty-four (24) months from and after the date of the order, the order requiring unit operation shall be automatically revoked.Laws, 2011, ch. 437, § 6, eff. 3/23/2011.Amended by Laws, 2022, ch. 369, HB 1214,§ 4, eff. 7/1/2022.