Florida Senate - 2016                              CS for SB 318
       By the Committee on Environmental Preservation and Conservation;
       and Senator Richter
       592-02111-16                                           2016318c1
    1                        A bill to be entitled                      
    2         An act relating to the regulation of oil and gas
    3         resources; amending s. 377.06, F.S.; preempting the
    4         regulation of all matters relating to the exploration,
    5         development, production, processing, storage, and
    6         transportation of oil and gas; declaring existing
    7         ordinances and regulations relating thereto void;
    8         providing an exception for certain zoning ordinances;
    9         amending s. 377.19, F.S.; applying the definitions of
   10         certain terms to additional sections of ch. 377, F.S.;
   11         revising the definition of the term “division”;
   12         conforming a cross-reference; defining the term “high
   13         pressure well stimulation”; amending s. 377.22, F.S.;
   14         revising the rulemaking authority of the Department of
   15         Environmental Protection; amending s. 377.24, F.S.;
   16         requiring that a permit be obtained before the
   17         performance of a high-pressure well stimulation;
   18         specifying that a permit may authorize single or
   19         multiple activities; deleting provisions that prohibit
   20         the Division of Water Resource Management from
   21         granting permits to drill gas or oil wells within the
   22         limits of a municipality without approval of the
   23         governing authority of the municipality; prohibiting
   24         the department from approving permits for high
   25         pressure well stimulation until certain rules are
   26         adopted and take effect; requiring legislative
   27         ratification of such rules; amending s. 377.241, F.S.;
   28         requiring the Division of Water Resource Management to
   29         give consideration to and be guided by certain
   30         additional criteria when issuing permits; amending s.
   31         377.242, F.S.; authorizing the department to issue
   32         permits for the performance of a high-pressure well
   33         stimulation; revising permit requirements that
   34         permitholders agree not to prevent division
   35         inspections; amending s. 377.2425, F.S.; requiring an
   36         applicant or operator to provide surety that
   37         performance of a high-pressure well stimulation will
   38         be conducted in a safe and environmentally compatible
   39         manner; creating s. 377.2436, F.S.; requiring the
   40         department to conduct a study on high-pressure well
   41         stimulation; providing study criteria; requiring the
   42         study to be submitted to the Governor and Legislature
   43         and posted on the department website; prohibiting the
   44         department from adopting rules until the study has
   45         been submitted to the Legislature; requiring the
   46         department to adopt rules under certain conditions by
   47         a specified date; amending s. 377.37, F.S.; increasing
   48         the maximum amount of a civil penalty; creating s.
   49         377.45, F.S.; requiring the department to designate
   50         the national chemical disclosure registry as the
   51         state’s registry; requiring service providers,
   52         vendors, and well owners or operators to report
   53         certain information to the department; requiring the
   54         department to report certain information to the
   55         national chemical registry; providing applicability;
   56         requiring the department to adopt rules; amending ss.
   57         377.07, 377.10, 377.243, and 377.244, F.S.; making
   58         technical changes; conforming provisions to changes
   59         made by the act; providing an appropriation; providing
   60         an effective date.
   62  Be It Enacted by the Legislature of the State of Florida:
   64         Section 1. Section 377.06, Florida Statutes, is amended to
   65  read:
   66         377.06 Public policy of state concerning natural resources
   67  of oil and gas; preemption.—
   68         (1) It is hereby declared the public policy of this state
   69  to conserve and control the natural resources of oil and gas in
   70  this state, and the products made from oil and gas in this
   71  state; to prevent waste of natural resources; to provide for the
   72  protection and adjustment of the correlative rights of the
   73  owners of the land in which the natural resources lie, of the
   74  owners and producers of oil and gas resources and the products
   75  made from oil and gas, and of others interested in these
   76  resources and products; and to safeguard the health, property,
   77  and public welfare of the residents of this state and other
   78  interested persons and for all purposes indicated by the
   79  provisions in this section.
   80         (2)Further, It is the public policy of this state declared
   81  that underground storage of natural gas is in the public
   82  interest because underground storage promotes conservation of
   83  natural gas,; makes gas more readily available to the domestic,
   84  commercial, and industrial consumers of this state,; and allows
   85  the accumulation of large quantities of gas in reserve for
   86  orderly withdrawal during emergencies or periods of peak demand.
   87  It is not the intention of this section to limit, restrict, or
   88  modify in any way the provisions of this law.
   89         (3) The Legislature declares that all matters relating to
   90  the regulation of the exploration, development, production,
   91  processing, storage, and transportation of oil and gas are
   92  preempted to the state, to the exclusion of all existing and
   93  future ordinances or regulations relating thereto adopted by any
   94  county, municipality, or other political subdivision of the
   95  state. Any such existing ordinance or regulation is void. A
   96  county or municipality may, however, enforce an existing zoning
   97  ordinance adopted before January 1, 2015, if the ordinance is
   98  otherwise valid.
   99         Section 2. Section 377.19, Florida Statutes, is amended to
  100  read:
  101         377.19 Definitions.—As used in ss. 377.06, 377.07, and
  102  377.10-377.45 377.10-377.40, the term:
  103         (1) “Completion date” means the day, month, and year that a
  104  new productive well, a previously shut-in well, or a temporarily
  105  abandoned well is completed, repaired, or recompleted and the
  106  operator begins producing oil or gas in commercial quantities.
  107         (2) “Department” means the Department of Environmental
  108  Protection.
  109         (3) “Division” means the Division of Water Resource
  110  Management of the Department of Environmental Protection.
  111         (4) “Field” means the general area that is underlaid, or
  112  appears to be underlaid, by at least one pool. The term includes
  113  the underground reservoir, or reservoirs, containing oil or gas,
  114  or both. The terms “field” and “pool” mean the same thing if
  115  only one underground reservoir is involved; however, the term
  116  “field,” unlike the term “pool,” may relate to two or more
  117  pools.
  118         (5) “Gas” means all natural gas, including casinghead gas,
  119  and all other hydrocarbons not defined as oil in subsection (16)
  120  (15).
  121         (6) “High-pressure well stimulation” means all stages of a
  122  well intervention performed by injecting fluids into a rock
  123  formation at high pressure that exceeds the fracture gradient of
  124  the rock formation in order to propagate fractures in such
  125  formation to increase production at an oil or gas well by
  126  improving the flow of hydrocarbons from the formation into the
  127  wellbore. The term does not include well stimulation or
  128  conventional workover procedures that may incidentally fracture
  129  the formation near the wellbore.
  130         (7)(6) “Horizontal well” means a well completed with the
  131  wellbore in a horizontal or nearly horizontal orientation within
  132  10 degrees of horizontal within the producing formation.
  133         (8)(7) “Illegal gas” means gas that has been produced
  134  within the state from any well or wells in excess of the amount
  135  allowed by any rule, regulation, or order of the division, as
  136  distinguished from gas produced within the State of Florida from
  137  a well not producing in excess of the amount so allowed, which
  138  is “legal gas.”
  139         (9)(8) “Illegal oil” means oil that has been produced
  140  within the state from any well or wells in excess of the amount
  141  allowed by rule, regulation, or order of the division, as
  142  distinguished from oil produced within the state from a well not
  143  producing in excess of the amount so allowed, which is “legal
  144  oil.”
  145         (10)(9) “Illegal product” means a product of oil or gas,
  146  any part of which was processed or derived, in whole or in part,
  147  from illegal gas or illegal oil or from any product thereof, as
  148  distinguished from “legal product,” which is a product processed
  149  or derived to no extent from illegal oil or illegal gas.
  150         (11)(10) “Lateral storage reservoir boundary” means the
  151  projection up to the land surface of the maximum horizontal
  152  extent of the gas volume contained in a natural gas storage
  153  reservoir.
  154         (12)(11) “Native gas” means gas that occurs naturally
  155  within this state and does not include gas produced outside the
  156  state, transported to this state, and injected into a permitted
  157  natural gas storage facility.
  158         (13)(12) “Natural gas storage facility” means an
  159  underground reservoir from which oil or gas has previously been
  160  produced and which is used or to be used for the underground
  161  storage of natural gas, and any surface or subsurface structure,
  162  or infrastructure, except wells. The term also includes a right
  163  or appurtenance necessary or useful in the operation of the
  164  facility for the underground storage of natural gas, including
  165  any necessary or reasonable reservoir protective area as
  166  designated for the purpose of ensuring the safe operation of the
  167  storage of natural gas or protecting the natural gas storage
  168  facility from pollution, invasion, escape, or migration of gas,
  169  or any subsequent extension thereof. The term does not mean a
  170  transmission, distribution, or gathering pipeline or system that
  171  is not used primarily as integral piping for a natural gas
  172  storage facility.
  173         (14)(13) “Natural gas storage reservoir” means a pool or
  174  field from which gas or oil has previously been produced and
  175  which is suitable for or capable of being made suitable for the
  176  injection, storage, and recovery of gas, as identified in a
  177  permit application submitted to the department under s.
  178  377.2407.
  179         (15)(14) “New field well” means an oil or gas well
  180  completed after July 1, 1997, in a new field as designated by
  181  the Department of Environmental Protection.
  182         (16)(15) “Oil” means crude petroleum oil and other
  183  hydrocarbons, regardless of gravity, which are produced at the
  184  well in liquid form by ordinary production methods, and which
  185  are not the result of condensation of gas after it leaves the
  186  reservoir.
  187         (17)(16) “Oil and gas” has the same meaning as the term
  188  “oil or gas.”
  189         (18)(17) “Oil and gas administrator” means the State
  190  Geologist.
  191         (19)(18) “Operator” means the entity who:
  192         (a) Has the right to drill and to produce a well; or
  193         (b) As part of a natural gas storage facility, injects, or
  194  is engaged in the work of preparing to inject, gas into a
  195  natural gas storage reservoir; or stores gas in, or removes gas
  196  from, a natural gas storage reservoir.
  197         (20)(19) “Owner” means the person who has the right to
  198  drill into and to produce from any pool and to appropriate the
  199  production for the person or for the person and another, or
  200  others.
  201         (21)(20) “Person” means a natural person, corporation,
  202  association, partnership, receiver, trustee, guardian, executor,
  203  administrator, fiduciary, or representative of any kind.
  204         (22)(21) “Pool” means an underground reservoir containing
  205  or appearing to contain a common accumulation of oil or gas or
  206  both. Each zone of a general structure which is completely
  207  separated from any other zone on the structure is considered a
  208  separate pool as used herein.
  209         (23)(22) “Producer” means the owner or operator of a well
  210  or wells capable of producing oil or gas, or both.
  211         (24)(23) “Product” means a commodity made from oil or gas
  212  and includes refined crude oil, crude tops, topped crude,
  213  processed crude petroleum, residue from crude petroleum,
  214  cracking stock, uncracked fuel oil, fuel oil, treated crude oil,
  215  residuum, gas oil, casinghead gasoline, natural gas gasoline,
  216  naphtha, distillate, condensate, gasoline, waste oil, kerosene,
  217  benzine, wash oil, blended gasoline, lubricating oil, blends or
  218  mixtures of oil with one or more liquid products or byproducts
  219  derived from oil or gas, and blends or mixtures of two or more
  220  liquid products or byproducts derived from oil or gas, whether
  221  hereinabove enumerated or not.
  222         (25)(24) “Reasonable market demand” means the amount of oil
  223  reasonably needed for current consumption, together with a
  224  reasonable amount of oil for storage and working stocks.
  225         (26)(25) “Reservoir protective area” means the area
  226  extending up to and including 2,000 feet surrounding a natural
  227  gas storage reservoir.
  228         (27)(26) “Shut-in bottom hole pressure” means the pressure
  229  at the bottom of a well when all valves are closed and no oil or
  230  gas has been allowed to escape for at least 24 hours.
  231         (28)(27) “Shut-in well” means an oil or gas well that has
  232  been taken out of service for economic reasons or mechanical
  233  repairs.
  234         (29)(28) “State” means the State of Florida.
  235         (30)(29) “Temporarily abandoned well” means a permitted
  236  well or wellbore that has been abandoned by plugging in a manner
  237  that allows reentry and redevelopment in accordance with oil or
  238  gas rules of the Department of Environmental Protection.
  239         (31)(30) “Tender” means a permit or certificate of
  240  clearance for the transportation or the delivery of oil, gas, or
  241  products, approved and issued or registered under the authority
  242  of the division.
  243         (32)(31) “Waste,” in addition to its ordinary meaning,
  244  means “physical waste” as that term is generally understood in
  245  the oil and gas industry. The term “waste” includes:
  246         (a) The inefficient, excessive, or improper use or
  247  dissipation of reservoir energy; and the locating, spacing,
  248  drilling, equipping, operating, or producing of any oil or gas
  249  well or wells in a manner that results, or tends to result, in
  250  reducing the quantity of oil or gas ultimately to be stored or
  251  recovered from any pool in this state.
  252         (b) The inefficient storing of oil; and the locating,
  253  spacing, drilling, equipping, operating, or producing of any oil
  254  or gas well or wells in a manner that causes, or tends to cause,
  255  unnecessary or excessive surface loss or destruction of oil or
  256  gas.
  257         (c) The producing of oil or gas in a manner that causes
  258  unnecessary water channeling or coning.
  259         (d) The operation of any oil well or wells with an
  260  inefficient gas-oil ratio.
  261         (e) The drowning with water of any stratum or part thereof
  262  capable of producing oil or gas.
  263         (f) The underground waste, however caused and whether or
  264  not defined.
  265         (g) The creation of unnecessary fire hazards.
  266         (h) The escape into the open air, from a well producing
  267  both oil and gas, of gas in excess of the amount that is
  268  necessary in the efficient drilling or operation of the well.
  269         (i) The use of gas for the manufacture of carbon black.
  270         (j) Permitting gas produced from a gas well to escape into
  271  the air.
  272         (k) The abuse of the correlative rights and opportunities
  273  of each owner of oil and gas in a common reservoir due to
  274  nonuniform, disproportionate, and unratable withdrawals, causing
  275  undue drainage between tracts of land.
  276         (33)(32) “Well site” means the general area around a well,
  277  which area has been disturbed from its natural or existing
  278  condition, as well as the drilling or production pad, mud and
  279  water circulation pits, and other operation areas necessary to
  280  drill for or produce oil or gas, or to inject gas into and
  281  recover gas from a natural gas storage facility.
  282         Section 3. Subsection (2) of section 377.22, Florida
  283  Statutes, is amended to read:
  284         377.22 Rules and orders.—
  285         (2) The department shall issue orders and adopt rules
  286  pursuant to ss. 120.536 and 120.54 to implement and enforce the
  287  provisions of this chapter. Such rules and orders shall ensure
  288  that all precautions are taken to prevent the spillage of oil or
  289  any other pollutant in all phases of the drilling for, and
  290  extracting of, oil, gas, or other petroleum products, including
  291  high-pressure well stimulations, or during the injection of gas
  292  into and recovery of gas from a natural gas storage reservoir.
  293  The department shall revise such rules from time to time as
  294  necessary for the proper administration and enforcement of this
  295  chapter. Rules adopted and orders issued in accordance with this
  296  section are for, but not limited to, the following purposes:
  297         (a) To require the drilling, casing, and plugging of wells
  298  to be done in such a manner as to prevent the pollution of the
  299  fresh, salt, or brackish waters or the lands of the state and to
  300  protect the integrity of natural gas storage reservoirs.
  301         (b) To prevent the alteration of the sheet flow of water in
  302  any area.
  303         (c) To require that appropriate safety equipment be
  304  installed to minimize the possibility of an escape of oil or
  305  other petroleum products in the event of accident, human error,
  306  or a natural disaster during drilling, casing, or plugging of
  307  any well and during extraction operations.
  308         (d) To require the drilling, casing, and plugging of wells
  309  to be done in such a manner as to prevent the escape of oil or
  310  other petroleum products from one stratum to another.
  311         (e) To prevent the intrusion of water into an oil or gas
  312  stratum from a separate stratum, except as provided by rules of
  313  the division relating to the injection of water for proper
  314  reservoir conservation and brine disposal.
  315         (f) To require a reasonable bond, or other form of security
  316  acceptable to the department, conditioned upon properly
  317  drilling, casing, producing, and operating each well and
  318  properly plugging the performance of the duty to plug properly
  319  each dry and abandoned well and upon the full and complete
  320  restoration by the applicant of the area over which geophysical
  321  exploration, drilling, or production is conducted to the similar
  322  contour and general condition in existence before prior to such
  323  operation.
  324         (g) To require and carry out a reasonable program of
  325  monitoring and inspecting or inspection of all drilling
  326  operations, high-pressure well stimulations, producing wells, or
  327  injecting wells, and well sites, including regular inspections
  328  by division personnel. Inspections are required during the
  329  testing of blowout preventers, during the pressure testing of
  330  the casing and casing shoe, and during the integrity testing of
  331  the cement plugs in plugging and abandonment operations.
  332         (h) To require the making of reports showing the location
  333  of all oil and gas wells; the making and filing of logs; the
  334  taking and filing of directional surveys; the filing of
  335  electrical, sonic, radioactive, and mechanical logs of oil and
  336  gas wells; if taken, the saving of cutting and cores, the cuts
  337  of which shall be given to the Bureau of Geology; and the making
  338  of reports with respect to drilling and production records.
  339  However, such information, or any part thereof, at the request
  340  of the operator, shall be exempt from the provisions of s.
  341  119.07(1) and held confidential by the division for a period of
  342  1 year after the completion of a well.
  343         (i) To prevent wells from being drilled, operated, or
  344  produced in such a manner as to cause injury to neighboring
  345  leases, property, or natural gas storage reservoirs.
  346         (j) To prevent the drowning by water of any stratum, or
  347  part thereof, capable of producing oil or gas in paying
  348  quantities and to prevent the premature and irregular
  349  encroachment of water which reduces, or tends to reduce, the
  350  total ultimate recovery of oil or gas from any pool.
  351         (k) To require the operation of wells with efficient gas
  352  oil ratio, and to fix such ratios.
  353         (l) To prevent “blowouts,” “caving,” and “seepage,” in the
  354  sense that conditions indicated by such terms are generally
  355  understood in the oil and gas business.
  356         (m) To prevent fires.
  357         (n) To identify the ownership of all oil or gas wells,
  358  producing leases, refineries, tanks, plants, structures, and
  359  storage and transportation equipment and facilities.
  360         (o) To regulate the “shooting,” perforating, and chemical
  361  treatment, and high-pressure stimulations of wells.
  362         (p) To regulate secondary recovery methods, including the
  363  introduction of gas, air, water, or other substance into
  364  producing formations.
  365         (q) To regulate gas cycling operations.
  366         (r) To regulate the storage and recovery of gas injected
  367  into natural gas storage facilities.
  368         (s) If necessary for the prevention of waste, as herein
  369  defined, to determine, limit, and prorate the production of oil
  370  or gas, or both, from any pool or field in the state.
  371         (t) To require, either generally or in or from particular
  372  areas, certificates of clearance or tenders in connection with
  373  the transportation or delivery of oil or gas, or any product.
  374         (u) To regulate the spacing of wells and to establish
  375  drilling units.
  376         (v) To prevent, so far as is practicable, reasonably
  377  avoidable drainage from each developed unit which is not
  378  equalized by counterdrainage.
  379         (w) To require that geophysical operations requiring a
  380  permit be conducted in a manner which will minimize the impact
  381  on hydrology and biota of the area, especially environmentally
  382  sensitive lands and coastal areas.
  383         (x) To regulate aboveground crude oil storage tanks in a
  384  manner which will protect the water resources of the state.
  385         (y) To act in a receivership capacity for fractional
  386  mineral interests for which the owners are unknown or unlocated
  387  and to administratively designate the operator as the lessee.
  388         (z)To evaluate the history of prior adjudicated,
  389  uncontested, or settled violations committed by permit
  390  applicants or the applicants’ affiliated entities of any
  391  substantive and material rule or law pertaining to the
  392  regulation of oil or gas.
  393         Section 4. Subsections (1), (2), (4), and (5) of section
  394  377.24, Florida Statutes, are amended, present subsections (6)
  395  through (9) of that section are redesignated as subsections (5)
  396  through (8), respectively, and a new subsection (9) and
  397  subsection (10) are added to that section, to read:
  398         377.24 Notice of intention to drill well; permits;
  399  abandoned wells and dry holes.—
  400         (1) Before drilling a well in search of oil or gas, before
  401  performing a high-pressure well stimulation, or before storing
  402  gas in or recovering gas from a natural gas storage reservoir,
  403  the person who desires to drill for, store, or recover gas, or
  404  drill for oil or gas, or perform a high-pressure well
  405  stimulation shall notify the division upon such form as it may
  406  prescribe and shall pay a reasonable fee set by rule of the
  407  department not to exceed the actual cost of processing and
  408  inspecting for each well or reservoir. The drilling of any well,
  409  the performance of any high-pressure well stimulation, and the
  410  storing and recovering of gas are prohibited until such notice
  411  is given, the fee is paid, and a the permit is granted. A permit
  412  may authorize a single activity or multiple activities.
  413         (2) An application for the drilling of a well in search of
  414  oil or gas, for the performance of a high-pressure well
  415  stimulation, or for the storing of gas in and recovering of gas
  416  from a natural gas storage reservoir, in this state must include
  417  the address of the residence of the applicant, or applicants,
  418  which must be the address of each person involved in accordance
  419  with the records of the Division of Water Resource Management
  420  until such address is changed on the records of the division
  421  after written request.
  422         (4) Application for permission to drill or abandon any well
  423  or perform a high-pressure well stimulation may be denied by the
  424  division for only just and lawful cause.
  425         (5) No permit to drill a gas or oil well shall be granted
  426  within the corporate limits of any municipality, unless the
  427  governing authority of the municipality shall have first duly
  428  approved the application for such permit by resolution.
  429         (9) The department may not approve a permit to authorize a
  430  high-pressure well stimulation until the department adopts rules
  431  for high-pressure well stimulations which are based upon the
  432  findings of the study required pursuant to s. 377.2436 and such
  433  rules take effect.
  434         (10) The rules for high-pressure well stimulation shall be
  435  submitted to the President of the Senate and Speaker of the
  436  House of Representatives and such rules may not take effect
  437  until they are ratified by the Legislature.
  438         Section 5. Subsections (5) and (6) are added to section
  439  377.241, Florida Statutes, to read:
  440         377.241 Criteria for issuance of permits.—The division, in
  441  the exercise of its authority to issue permits as hereinafter
  442  provided, shall give consideration to and be guided by the
  443  following criteria:
  444         (5) For high-pressure well stimulations, whether the high
  445  pressure well stimulation as proposed is designed to ensure
  446  that:
  447         (a)The groundwater near the well location, including
  448  groundwater through which the well will be or has been drilled,
  449  is not contaminated as a result of the high-pressure well
  450  stimulation; and
  451         (b) The high-pressure well stimulation is consistent with
  452  the public policy of this state as specified in s. 377.06.
  453         (6) As a basis for permit denial or imposition of specific
  454  permit conditions, including increased bonding up to five times
  455  the applicable limits and increased monitoring, the history of
  456  prior adjudicated, uncontested, or settled violations committed
  457  by the applicant or an affiliated entity of the applicant of any
  458  substantive and material rule or law pertaining to the
  459  regulation of oil or gas, including violations that occurred
  460  outside the state.
  461         Section 6. Section 377.242, Florida Statutes, is amended to
  462  read:
  463         377.242 Permits for drilling or exploring and extracting
  464  through well holes or by other means.—The department is vested
  465  with the power and authority:
  466         (1)(a) To issue permits for the performance of a high
  467  pressure well stimulation or the drilling for, exploring for, or
  468  production of oil, gas, or other petroleum products that which
  469  are to be extracted from below the surface of the land,
  470  including submerged land, only through the well hole drilled for
  471  oil, gas, and other petroleum products.
  472         1. A No structure intended for the drilling for, or
  473  production of, oil, gas, or other petroleum products may not be
  474  permitted or constructed on any submerged land within any bay or
  475  estuary.
  476         2. A No structure intended for the drilling for, or
  477  production of, oil, gas, or other petroleum products may not be
  478  permitted or constructed within 1 mile seaward of the coastline
  479  of the state.
  480         3. A No structure intended for the drilling for, or
  481  production of, oil, gas, or other petroleum products may not be
  482  permitted or constructed within 1 mile of the seaward boundary
  483  of any state, local, or federal park or aquatic or wildlife
  484  preserve or on the surface of a freshwater lake, river, or
  485  stream.
  486         4. A No structure intended for the drilling for, or
  487  production of, oil, gas, or other petroleum products may not be
  488  permitted or constructed within 1 mile inland from the shoreline
  489  of the Gulf of Mexico, the Atlantic Ocean, or any bay or estuary
  490  or within 1 mile of any freshwater lake, river, or stream unless
  491  the department is satisfied that the natural resources of such
  492  bodies of water and shore areas of the state will be adequately
  493  protected in the event of accident or blowout.
  494         5. Without exception, after July 1, 1989, a no structure
  495  intended for the drilling for, or production of, oil, gas, or
  496  other petroleum products may not be permitted or constructed
  497  south of 26°00′00″ north latitude off Florida’s west coast and
  498  south of 27°00′00″ north latitude off Florida’s east coast,
  499  within the boundaries of Florida’s territorial seas as defined
  500  in 43 U.S.C. s. 1301. After July 31, 1990, a no structure
  501  intended for the drilling for, or production of, oil, gas, or
  502  other petroleum products may not be permitted or constructed
  503  north of 26°00′00″ north latitude off Florida’s west coast to
  504  the western boundary of the state bordering Alabama as set forth
  505  in s. 1, Art. II of the State Constitution, or located north of
  506  27°00′00″ north latitude off Florida’s east coast to the
  507  northern boundary of the state bordering Georgia as set forth in
  508  s. 1, Art. II of the State Constitution, within the boundaries
  509  of Florida’s territorial seas as defined in 43 U.S.C. s. 1301.
  510         (b) Subparagraphs (a)1. and 4. do not apply to permitting
  511  or construction of structures intended for the drilling for, or
  512  production of, oil, gas, or other petroleum products pursuant to
  513  an oil, gas, or mineral lease of such lands by the state under
  514  which lease any valid drilling permits are in effect on the
  515  effective date of this act. In the event that such permits
  516  contain conditions or stipulations, such conditions and
  517  stipulations shall govern and supersede subparagraphs (a)1. and
  518  4.
  519         (c) The prohibitions of subparagraphs (a)1.-4. in this
  520  subsection do not include “infield gathering lines,” provided no
  521  other placement is reasonably available and all other required
  522  permits have been obtained.
  523         (2) To issue permits to explore for and extract minerals
  524  which are subject to extraction from the land by means other
  525  than through a well hole.
  526         (3) To issue permits to establish natural gas storage
  527  facilities or construct wells for the injection and recovery of
  528  any natural gas for storage in natural gas storage reservoirs.
  530  Each permit shall contain an agreement by the permitholder that
  531  the permitholder will not prevent inspection by division
  532  personnel at any time, including during installation and
  533  cementing of casing, during the testing of blowout preventers,
  534  during the pressure testing of the casing and casing shoe, and
  535  during the integrity testing of the cement plugs in plugging and
  536  abandonment operations. The provisions of this section
  537  prohibiting permits for drilling or exploring for oil in coastal
  538  waters do not apply to any leases entered into before June 7,
  539  1991.
  540         Section 7. Subsection (1) of section 377.2425, Florida
  541  Statutes, is amended to read:
  542         377.2425 Manner of providing security for geophysical
  543  exploration, drilling, and production.—
  544         (1) Before Prior to granting a permit for conducting to
  545  conduct geophysical operations; drilling of exploratory,
  546  injection, or production wells; producing oil and gas from a
  547  wellhead; performing a high-pressure well stimulation; or
  548  transporting oil and gas through a field-gathering system, the
  549  department shall require the applicant or operator to provide
  550  surety that these operations will be conducted in a safe and
  551  environmentally compatible manner.
  552         (a) The applicant for a drilling, production, high-pressure
  553  well stimulation, or injection well permit or a geophysical
  554  permit may provide the following types of surety to the
  555  department for this purpose:
  556         1. A deposit of cash or other securities made payable to
  557  the Minerals Trust Fund. Such cash or securities so deposited
  558  shall be held at interest by the Chief Financial Officer to
  559  satisfy safety and environmental performance provisions of this
  560  chapter. The interest shall be credited to the Minerals Trust
  561  Fund. Such cash or other securities shall be released by the
  562  Chief Financial Officer upon request of the applicant and
  563  certification by the department that all safety and
  564  environmental performance provisions established by the
  565  department for permitted activities have been fulfilled.
  566         2. A bond of a surety company authorized to do business in
  567  the state in an amount as provided by rule.
  568         3. A surety in the form of an irrevocable letter of credit
  569  in an amount as provided by rule guaranteed by an acceptable
  570  financial institution.
  571         (b) An applicant for a drilling, production, high-pressure
  572  well stimulation, or injection well permit, or a permittee who
  573  intends to continue participating in long-term production
  574  activities of such wells, has the option to provide surety to
  575  the department by paying an annual fee to the Minerals Trust
  576  Fund. For an applicant or permittee choosing this option the
  577  following shall apply:
  578         1. For the first year, or part of a year, of a drilling,
  579  production, or injection well permit, or change of operator, the
  580  fee is $4,000 per permitted well.
  581         2. For each subsequent year, or part of a year, the fee is
  582  $1,500 per permitted well.
  583         3. The maximum fee that an applicant or permittee may be
  584  required to pay into the trust fund is $30,000 per calendar
  585  year, regardless of the number of permits applied for or in
  586  effect.
  587         4. The fees set forth in subparagraphs 1., 2., and 3. shall
  588  be reviewed by the department on a biennial basis and adjusted
  589  for the cost of inflation. The department shall establish by
  590  rule a suitable index for implementing such fee revisions.
  591         (c) An applicant for a drilling or operating permit for
  592  operations planned in coastal waters that by their nature
  593  warrant greater surety shall provide surety only in accordance
  594  with paragraph (a), or similar proof of financial responsibility
  595  other than as provided in paragraph (b). For all such
  596  applications, including applications pending at the effective
  597  date of this act and notwithstanding the provisions of paragraph
  598  (b), the Governor and Cabinet in their capacity as the
  599  Administration Commission, at the recommendation of the
  600  department of Environmental Protection, shall set a reasonable
  601  amount of surety required under this subsection. The surety
  602  amount shall be based on the projected cleanup costs and natural
  603  resources damages resulting from a maximum oil spill and adverse
  604  hydrographic and atmospheric conditions that would tend to
  605  transport the oil into environmentally sensitive areas, as
  606  determined by the department of Environmental Protection.
  607         Section 8. Section 377.2436, Florida Statutes, is created
  608  to read:
  609         377.2436 Study on high-pressure well stimulations.—
  610         (1) The department shall conduct a study on high-pressure
  611  well stimulations. The study must:
  612         (a) Evaluate the underlying geologic features present in
  613  the counties where oil wells have been permitted and analyze the
  614  potential impact that high-pressure well stimulation and
  615  wellbore construction may have on the underlying geologic
  616  features.
  617         (b) Evaluate the potential hazards and risks that high
  618  pressure well stimulation poses to surface water or groundwater
  619  resources. The study must assess the potential impacts of high
  620  pressure well stimulation on drinking water resources and
  621  identify the main factors affecting the severity and frequency
  622  of impacts and must analyze the potential for the use or reuse
  623  of recycled water in well stimulation fluids while meeting
  624  appropriate water quality standards.
  625         (c) Review and evaluate the potential for groundwater
  626  contamination from conducting high-pressure well stimulation
  627  under or near wells that have been previously plugged and
  628  abandoned and identify a setback radius from previously plugged
  629  and abandoned wells that could be impacted by high-pressure well
  630  stimulation.
  631         (d) Review and evaluate the ultimate disposition of high
  632  pressure well stimulation fluids after use in high-pressure well
  633  stimulation processes.
  634         (2) The department shall continue conventional oil and gas
  635  business operations during the performance of the study. There
  636  may not be a moratorium on the evaluation and issuance of
  637  permits for conventional drilling, exploration, conventional
  638  completions, or conventional workovers during the performance of
  639  the study.
  640         (3) The study is subject to independent scientific peer
  641  review.
  642         (4) The department shall submit the findings of the study
  643  to the Governor, the President of the Senate, and the Speaker of
  644  the House of Representatives by June 30, 2017, and shall
  645  prominently post the findings on its website.
  646         (5)The department may not adopt rules for high-pressure
  647  well stimulation until the findings of the study have been
  648  submitted to the Legislature. However, by March 1, 2018, the
  649  department must adopt rules to implement the findings of the
  650  study, if such rules are warranted to protect public health,
  651  safety, and the environment.
  652         Section 9. Paragraph (a) of subsection (1) of section
  653  377.37, Florida Statutes, is amended to read:
  654         377.37 Penalties.—
  655         (1)(a) A Any person who violates any provision of this
  656  chapter law or any rule, regulation, or order of the division
  657  made under this chapter or who violates the terms of any permit
  658  to drill for or produce oil, gas, or other petroleum products
  659  referred to in s. 377.242(1) or to store gas in a natural gas
  660  storage facility, or any lessee, permitholder, or operator of
  661  equipment or facilities used in the exploration for, drilling
  662  for, or production of oil, gas, or other petroleum products, or
  663  storage of gas in a natural gas storage facility, who refuses
  664  inspection by the division as provided in this chapter, is
  665  liable to the state for any damage caused to the air, waters, or
  666  property, including animal, plant, or aquatic life, of the state
  667  and for reasonable costs and expenses of the state in tracing
  668  the source of the discharge, in controlling and abating the
  669  source and the pollutants, and in restoring the air, waters, and
  670  property, including animal, plant, and aquatic life, of the
  671  state. Furthermore, such person, lessee, permitholder, or
  672  operator is subject to the judicial imposition of a civil
  673  penalty in an amount of not more than $25,000 $10,000 for each
  674  offense. However, the court may receive evidence in mitigation.
  675  Each day during any portion of which such violation occurs
  676  constitutes a separate offense. This paragraph does not Nothing
  677  herein shall give the department the right to bring an action on
  678  behalf of a any private person.
  679         Section 10. Section 377.45, Florida Statutes, is created to
  680  read:
  681         377.45 High-pressure well stimulation chemical disclosure
  682  registry.—
  683         (1)(a) The department shall designate the national chemical
  684  disclosure registry, known as FracFocus, developed by the Ground
  685  Water Protection Council and the Interstate Oil and Gas Compact
  686  Commission, as the state’s registry for chemical disclosure for
  687  all wells on which high-pressure well stimulations are
  688  performed. The department shall provide a link to FracFocus
  689  through its website.
  690         (b) In addition to providing the following information to
  691  the department as part of the permitting process, a service
  692  provider, vendor, or well owner or operator shall report, as
  693  established by department rule, to the department, at a minimum,
  694  the following information:
  695         1. The name of the service provider, vendor, or owner or
  696  operator.
  697         2. The date of completion of the high-pressure well
  698  stimulation.
  699         3. The county in which the well is located.
  700         4. The API Well Number.
  701         5. The well name and number.
  702         6. The longitude and latitude of the wellhead.
  703         7. The total vertical depth of the well.
  704         8. The total volume of water used in the high-pressure well
  705  stimulation.
  706         9. Each chemical ingredient that is subject to 29 C.F.R. s.
  707  1910.1200(g)(2) and the ingredient concentration in the high
  708  pressure well stimulation fluid by mass for each well on which a
  709  high-pressure well stimulation is performed.
  710         10. The trade or common name and the CAS Registry Number
  711  for each chemical ingredient.
  712         (c) The department shall report to FracFocus all
  713  information received under paragraph (b), excluding any
  714  information subject to chapter 688.
  715         (d) If FracFocus cannot accept and make publicly available
  716  any information specified in this section, the department shall
  717  post the information on its website, excluding any information
  718  subject to chapter 688.
  719         (2) A service provider, vendor, or well owner or operator
  720  shall:
  721         (a) Report the information required under subsection (1) to
  722  the department within 60 days after the initiation of the high
  723  pressure well stimulation for each well on which such high
  724  pressure well stimulation is performed.
  725         (b) Notify the department if any chemical ingredient not
  726  previously reported is intentionally included and used for the
  727  purpose of performing a high-pressure well stimulation.
  728         (3) This section does not apply to an ingredient that:
  729         (a) Is not intentionally added to the high-pressure well
  730  stimulation; or
  731         (b) Occurs incidentally or is otherwise unintentionally
  732  present in a high-pressure well stimulation.
  733         (4) The department shall adopt rules to administer this
  734  section.
  735         Section 11. Section 377.07, Florida Statutes, is amended to
  736  read:
  737         377.07 Division of Water Resource Management; powers,
  738  duties, and authority.—The Division of Water Resource Management
  739  of the Department of Environmental Protection is hereby vested
  740  with power, authority, and duty to administer, carry out, and
  741  enforce the provisions of this part law as directed in s.
  742  370.02(3).
  743         Section 12. Section 377.10, Florida Statutes, is amended to
  744  read:
  745         377.10 Certain persons not to be employed by division.—A No
  746  person in the employ of, or holding any official connection or
  747  position with any person, firm, partnership, corporation, or
  748  association of any kind, engaged in the business of buying or
  749  selling mineral leases, drilling wells in the search of oil or
  750  gas, producing, transporting, refining, or distributing oil or
  751  gas may not shall hold any position under, or be employed by,
  752  the Division of Water Resource Management in the prosecution of
  753  its duties under this part law.
  754         Section 13. Subsection (1) of section 377.243, Florida
  755  Statutes, is amended to read:
  756         377.243 Conditions for granting permits for extraction
  757  through well holes.—
  758         (1) Before applying Prior to the application to the
  759  Division of Water Resource Management for the permit to drill
  760  for oil, gas, and related products referred to in s. 377.242(1),
  761  the applicant must own a valid deed, or other muniment of title,
  762  or lease granting the said applicant the privilege to explore
  763  for oil, gas, or related mineral products to be extracted only
  764  through the well hole on the land or lands included in the
  765  application. However, unallocated interests may be unitized
  766  according to s. 377.27.
  767         Section 14. Subsection (1) of section 377.244, Florida
  768  Statutes, is amended to read:
  769         377.244 Conditions for granting permits for surface
  770  exploratory and extraction operations.—
  771         (1) Exploration for and extraction of minerals under and by
  772  virtue of the authority of a grant of oil, gas, or mineral
  773  rights, or which, subsequent to such grant, may be interpreted
  774  to include the right to explore for and extract minerals which
  775  are subject to extraction from the land by means other than
  776  through a well hole, that is by means of surface exploratory and
  777  extraction operations such as sifting of the sands, dragline,
  778  open pit mining, or other type of surface operation, which would
  779  include movement of sands, dirt, rock, or minerals, shall be
  780  exercised only pursuant to a permit issued by the Division of
  781  Water Resource Management upon the applicant’s compliance
  782  applicant complying with the following conditions:
  783         (a) The applicant must own a valid deed, or other muniment
  784  of title, or lease granting the applicant the right to explore
  785  for and extract oil, gas, and other minerals from the said
  786  lands.
  787         (b) The applicant shall post a good and sufficient surety
  788  bond with the division in such amount as the division determines
  789  may determine is adequate to afford full and complete protection
  790  for the owner of the surface rights of the lands described in
  791  the application, conditioned upon the full and complete
  792  restoration, by the applicant, of the area over which the
  793  exploratory and extraction operations are conducted to the same
  794  condition and contour in existence before prior to such
  795  operations.
  796         Section 15. For the 2016-2017 fiscal year, the sum of $1
  797  million in nonrecurring funds is appropriated from the General
  798  Revenue Fund to the Department of Environmental Protection to
  799  conduct a high-pressure well stimulation study pursuant to s.
  800  377.2436, Florida Statutes.
  801         Section 16. This act shall take effect July 1, 2016.