11.17.1.1. An Applicant seeking an SUDP for an Oil or Gas Facility shall furnish financial assurances acceptable to the County.

11.17.1.2. Acceptable financial assurances may include: a. A bond in the principal sum of such amount as may be determined by the Board, but not less than Fifty Thousand Dollars ($50,000), in an amount representing the actual cost to remediate the site of the Oil or Gas Facility after abandonment less the amount of any agreement entered into by and between the Operator and a surface owner pursuant to the Surface Owners’ Protection Act. A bond shall be executed by a reliable insurance company authorized to do business in the State of New Mexico, as surety, and the Applicant as principal, running to the County for the benefit of the County and all persons concerned, under the condition that the Operator shall comply with the terms and conditions of this Section 11 in the drilling and operation of the well. An irrevocable letter of credit issued by a federally-insured financial institution located within the State of New Mexico, backed by cash on deposit at the institution representing the full value of the amount of the letter of credit. The amount shall be set as may be determined by the Board, but in no event shall be for a sum less than Fifty Thousand Dollars ($50,000). A letter of credit shall be for a term of not less than five (5) years, and shall be automatically renewed on like terms unless the issuer notifies the County in writing of non-renewal at least thirty (30) days prior to the end of the five (5) year period.

11.17.1.3. All financial assurances pursuant to this Section shall become effective on or before the date that documentation of such financial assurance is filed with the County.

11.17.1.4. The County shall release the financial assurance deposited pursuant to this Section upon written request of the Operator if the well has been plugged and abandoned and the location restored and/or remediated pursuant to this Ordinance, if the relevant Oil or Gas Facility has ceased operation and has been similarly restored and/or remediated pursuant to this Ordinance, or if a Change of Operator has been approved pursuant to this Article and a new SUDP development order has been granted.
 

11.17.2. Comprehensive General Liability Insurance.
In addition to the required financial assurance, the Operator shall submit with the Application a policy or policies of commercial general liability insurance, including contractual liability, covering bodily injuries and property damage that names the Operator as the insured and the County as an additional insured, issued by an insurance company licensed to do business in the State of New Mexico. The insurance policy must be in a form acceptable to the County and shall further provide a limit of liability of not less than Ten Million Dollars ($ 10,000,000) per occurrence. Said policy or policies shall provide that they may not be cancelled without written notice to the County of at least thirty (30) days prior to the effective date of such cancellation.

11.17.3. Pollution Liability Insurance.
The Operator shall submit with the Application a pollution insurance policy or policies that provide standard pollution liability insurance with a coverage of not less than $10,000,000 per occurrence, issued by an insurance company authorized to do business in the State, and that names the Operator as insured. Such insurance policy shall be maintained in full force and effect from the date an Application is submitted and continuing in force until the well is plugged and abandoned in accordance with the applicable State statutes, OCD regulations and this Ordinance. A separate policy is not required if pollution coverage is included as a part of the comprehensive general liability insurance policy required by Section 11.17.2, above. The insurance policy or policies shall provide that they may not be cancelled without written notice to the County at least thirty (30) days prior to the effective date of such cancellation.

11.17.4. Self Insurance.
An Operator offering a plan of self-insurance may provide a certificate of insurance as required by this section issued pursuant to such plan provided that such plan has been approved by the Public Regulation Commission of the State of New Mexico and the County’s Risk Manager.

See SECTION 11: OIL AND GAS SPECIAL USE AND DEVELOPMENT PERMIT PROVISIONS for complete, detailed information.