S.C. Code Regs. § 121-8.6 - Performance Bond

A. Before any person shall be granted a well drilling permit, such person shall file with the Commission a reasonable performance bond in an amount as hereinafter set forth, as provided in Section 121-8.5(b). Such bond shall be payable to the State of South Carolina for each well, executed by such person as principal, and by some surety approved by the Commission. The bond shall be conditioned to secure the faithful performance of all requirements of the Act, these rules and regulations, and any permit conditions and restrictions. If the operator fails to comply with requirements of the Act, these rules and regulations, or any permit conditions or restrictions, said bond shall be forfeited and the Commission shall expend the proceeds of the bond to fulfill the operator's responsibilities to protect the State and its citizens from any injury which may result from such failure. The bond shall remain in effect for a period of two years from the date of receipt of all data required by these rules and regulations, whichever occurs last. The amount of such bond shall be in accordance with the following relationship with proposed bottom depth for onshore wells.

Depth in feet	Amount of bond required
to 10,000	$20,000
10,000-15,000	$30,000
15,000-20,000	$40,000
20,000 or more	$50,000

The amount of bond required for each well on submerged lands shall be one hundred thousand ($100,000) dollars.

B. The Commission, in its discretion for good cause, after notice and hearing may require a different amount of bond because of environmentally sensitive conditions at the drill site or for other justifiable reasons and may determine any existing bond to be inadequate and require the filing of a new and different bond or an appropriate amendment to a previously filed bond.

C. Any such bond filed with the Commission, including any amendment or addendum thereto, must set forth the correct legal name and address of the principal and the surety thereto and must be countersigned by a South Carolina agent of such surety, setting forth the correct legal name of such agent and such agent's company affiliation and correct business address.

D. The Commission in its discretion may allow the filing of a blanket bond (except for wells on submerged lands) by an operator in the amount of one hundred thousand ($100,000) dollars. The Commission, after notice and hearing may for good cause, require the filing of a new blanket bond of a different amount superseding any previous order by the Commission regarding a blanket bond, and any blanket bond shall require and have the same requirements as set forth hereinabove for single well bonds except that blanket bonds may apply to more than one well and the amount of such blanket bond may not be required to be in accordance with the aforesaid relationship of footage.

E. Failure to comply with any of the conditions of this section shall not be cause for avoidance of any of the obligations and conditions set forth herein by any principal or surety.

Notes

S.C. Code Regs. § 121-8.6