Kansas Statutes

Chapter 55: Oil And Gas

Article 6: Crude Oil Or Petroleum; Production And Sale

Statutes:

• 55-601: Waste prohibited.
• 55-602: Waste defined; rules and regulations; person defined.
• 55-602a:
• 55-603: Production regulated; prevention of unreasonable discrimination.
• 55-604: Powers of commission; proration of production; approval of plan or distribution.
• 55-604a: Severability.
• 55-605: Enforcement of act; jurisdiction of commission over proceedings and hearings; notice; emergency rule, regulation or order; punishment for contempt; conduct of investigations and hearings by certain officers or employees; findings and recommendations; application of Kansas administrative procedure act.
• 55-606: Rehearing; judicial review.
• 55-607: Penalty for violations of 55-601 to 55-609.
• 55-608: Injunction and other remedies.
• 55-609: Assessment of costs of administering 55-601 to 55-613; disposition of moneys.
• 55-609a: Invalidity of 55-601 to 55-609.
• 55-609b: Invalidity of 55-602 to 55-606.
• 55-609c:
• 55-610: Buying or selling of illegally produced crude oil or petroleum unlawful.
• 55-611: Same; penalties.
• 55-612, 55-613:

• 55-601: Waste prohibited. The production of crude oil or petroleum in the state of Kansas in such manner and under such conditions as to constitute waste is hereby prohibited and shall be unlawful.

        History:   L. 1931, ch. 226, § 1; May 28.

• 55-602: Waste defined; rules and regulations; person defined. The term "waste" as used herein, in addition to its ordinary meaning, shall include economic waste, underground waste, surface waste, waste of reservoir energy, and the production of crude oil or petroleum in excess of transportation or marketing facilities or reasonable market demands. The state corporation commission shall have authority to make rules and regulations for the prevention of such waste and for the protection of all fresh-water strata, and oil- and gas-bearing strata encountered in any well drilled for, or producing, oil. "Person" as herein used shall mean any natural person, corporation, association, partnership, receiver, trustee, guardian, executor, administrator and a fiduciary of any kind.

        History:   L. 1931, ch. 226, § 2; L. 1933, ch. 214, § 1; L. 1939, ch. 227, § 1; March 30.

• 55-602a:

        History:   L. 1939, ch. 227, § 6; Repealed, L. 1951, ch. 328, § 1; June 30.

• 55-603: Production regulated; prevention of unreasonable discrimination. Whenever the full production from any common source of supply, herein called "pool", of crude oil in this state can be obtained only under conditions (a) constituting waste as defined by K.S.A. 55-602 and amendments thereto, or (b) independently of waste, under conditions injurious to the respective correlative rights of the producers in the pool, or (c) under conditions unreasonably discriminating against other pools in the state, any person having the right to drill into and produce oil from the pool may take currently no more than that proportion of all crude oil which may be produced from the pool currently without such waste, injury or discrimination, which the productivity of such person's well or wells, considered in connection with the acreage reasonably attributable to each such well, bears to the productivity of all the wells in the pool, considered in connection with the acreage reasonably attributable to each well in the pool. The state corporation commission is authorized, and it shall be its duty, to regulate the taking of crude oil from any pool within the state of Kansas as to prevent waste in the pool or, independently of waste, to prevent the inequitable or unfair taking of crude oil from the pool by any person and to prevent unreasonable discrimination therein. The commission is further authorized, and it shall be its duty, to prevent unreasonable discrimination in favor of any one pool as against any other pool or pools in this state in the allocation of allowable production among such pools.

        History:   L. 1931, ch. 226, § 3; L. 1939, ch. 227, § 2; L. 1957, ch. 315, § 1; L. 1965, ch. 341, § 1; L. 1988, ch. 356, § 167; L. 1995, ch. 9, § 1; July 1.

• 55-604: Powers of commission; proration of production; approval of plan or distribution. (a) The commission shall have and is hereby given jurisdiction and authority:

        (1)   Over all matters involving the application and enforcement of this act;

        (2)   to make and enforce rules, regulations and orders for the prevention of waste as defined by K.S.A. 55-602 and amendments thereto and for carrying out and enforcing each and all of the provisions of this act;

        (3)   to employ or appoint such agent or agents as necessary to enforce and administer the provisions of this act and rules, regulations and orders adopted or issued under this act. Such agent or agents, with the exception of clerical help, shall be experienced in and conversant with the oil business; and

        (4)   as otherwise provided, without limiting the generality of the foregoing authority provided in this section.

        (b)   In prorating the production allowed to each pool among the wells in the pool, the commission shall take into consideration, among such other factors as it finds proper, and give due and proper weight to:

        (1)   The productivity of each such well as determined by such reasonable method as the commission shall adopt for the pool;

        (2)   the acreage of each well owner which is reasonably attributable to each of the owner's wells; and

        (3)   the efficient utilization of the reservoir energy in the pool, except that the allowable production of any well in any prorated pool shall not be reduced below 25 barrels per day. The 25 barrels per day minimum per well allowable may be reduced proportionately when the acreage attributable to any well is less than the number of acres in a spacing unit established by the corporation commission for wells in a spaced pool. In the absence of such a spacing unit, when the acreage attributable to any well is less than 10 acres, the 25 barrels per day minimum per well allowable may be reduced in the proportion that the acreage attributable to the well bears to 10 acres, except that the reduction in the 25 barrels per day minimum per well allowable by virtue of acreage adjustment shall not apply to oil and gas wells drilled or commenced prior to the effective date of this act.

        (c)   When it appears to the commission that those having a right to drill into and produce oil from any pool, part of any pool or prospective pool, in this state, have unanimously agreed upon a plan for the development of such pool, part of any pool or prospective pool or for the distribution of allowed production in the pool, the commission, after notice and hearing in accordance with the provisions of the Kansas administrative procedure act, may approve such plan or distribution.

        History:   L. 1931, ch. 226, § 4; L. 1939, ch. 227, § 3; L. 1947, ch. 310, § 1; L. 1957, ch. 316, § 1; L. 1959, ch. 236, § 1; L. 1965, ch. 341, § 2; L. 1973, ch. 219, § 3; L. 1988, ch. 356, § 168; L. 1995, ch. 9, § 2; July 1.

• 55-604a: Severability. If any clause, sentence, section, subsection, provision, or part of this act shall be adjudged to be invalid or unconstitutional by any court of competent jurisdiction, such judgment shall not invalidate, impair, or affect the remainder of this act, which shall remain in full force and effect.

        History:   L. 1965, ch. 341, § 3; July 1.

• 55-605: Enforcement of act; jurisdiction of commission over proceedings and hearings; notice; emergency rule, regulation or order; punishment for contempt; conduct of investigations and hearings by certain officers or employees; findings and recommendations; application of Kansas administrative procedure act. (a) Any person, or the attorney general on behalf of the state, or the state corporation commission on its own initiative, may institute proceedings before the commission upon any question relating to the enforcement of this act, or for the making, revocation, change, renewal or extension, or for the enforcement of, any rule, regulation or order thereunder, and jurisdiction is hereby conferred upon the commission to hear and determine the same. The commission shall set a reasonable time and place when such hearing shall be had, and, in the case of proceedings initiated by the attorney general or the commission, give reasonable notice thereof, in no case less than 10 days, to all persons interested therein by one publication of such notice, in some newspaper or newspapers having a general circulation in this state, as designated by the commission, and in some newspaper having a general circulation in the county or counties where such lands affected by such proceedings are located, and by the second-class mailing of a copy thereof to each such person who shall have filed with the commission such person's name and address for the purpose of receiving notice. In all other cases, reasonable notice shall be given by the person initiating the proceedings, in no case less than 10 days prior to the hearing, by publication of such notice in a newspaper having a general circulation in the state, as designated by the commission, and in some newspaper having a general circulation in the county or counties where such lands affected by such proceedings are located, and the commission shall mail by second-class mail, a copy of such notice to each person who shall have filed with the commission such person's name and address for the purpose of notice. Additional notice shall be given by the person initiating the proceedings when required in accordance with rules and regulations adopted by the commission. The commission may accept as proof of notice an affidavit sworn to by the person initiating such proceedings that such notice has been perfected. Any such affidavit shall be filed with the commission on or before the hearing date. Each such notice shall state the time and place of hearing and contain such other information as will briefly and adequately disclose the matter to be considered or the relief sought. In case an emergency is found by the commission to exist which in its judgment requires the making of a rule, regulation or order or taking an enforcement action, without first having a hearing, such emergency rule, regulation, order or action shall have the same validity as if a hearing with respect to the same had been held after due notice, but shall remain in force no longer than 30 days from its effective date. In the exercise and enforcement of such jurisdiction the commission is authorized to summon witnesses, administer oaths, make ancillary orders, and use such means and final process, including inspection of records and books analogous to proceedings under its control over public service corporations as now provided by law. In connection with the exercise and enforcement of its jurisdiction, the commission shall also have the right and authority to certify as for contempt to the district court of any county having jurisdiction, violations by any person of any of the provisions of this act or rules, regulations or orders of the commission, and if it is found by the district court that such person, firm or corporation has knowingly and willfully violated same, then such person shall be punished as for contempt in the same manner and to the same extent and with like effect as if such contempt had been of an order, judgment or decree of the district court to which the certification is made. Any person desiring notice of any such proceeding shall file with the commission such person's name and address accompanied by a fee established by rule and regulation of the commission. All such fees shall be remitted to the state treasurer who shall credit the same to the conservation fee fund.

        (b)   The state corporation commission is hereby authorized to designate or appoint its director of petroleum conservation or its assistant director of petroleum conservation or one of its attorneys as an examiner or referee to make investigations and conduct hearings that are required of the commission by this act. Such investigations and hearings shall be made and conducted in the same manner as by the commission. Such examiners and referees shall have the power to administer oaths and to subpoena witnesses. The commission may provide for a record to be made of any hearing or investigation. Such examiners and referees shall submit their findings and recommendations in writing to the commission.

        (c)   If the agency action contemplated by proceedings instituted before the commission under this section is an order as defined in subsection (d) of K.S.A. 77-502 and amendments thereto, proceedings on such order shall be conducted in accordance with the provisions of the Kansas administrative procedure act. To the extent that the procedures contained in subsections (a) and (b) of this section are not in conflict, such procedures shall be supplemental to the procedures contained in the administrative procedure act.

        History:   L. 1931, ch. 226, § 5; L. 1939, ch. 227, § 4; L. 1957, ch. 317, § 1; L. 1984, ch. 203, § 1; L. 1988, ch. 356, § 169; July 1, 1989.

• 55-606: Rehearing; judicial review. (a) Any action of the commission pursuant to K.S.A. 55-601 through 55-609, and amendments thereto, is subject to review in accordance with the act for judicial review and civil enforcement of agency actions. The action for review shall be brought in the district court having venue and first acquiring jurisdiction of the matter. Notwithstanding the provisions of K.S.A. 77-622 and amendments thereto, the authority of the court shall be limited to a judgment either affirming or setting aside in whole or in part the agency action.

        (b)   Before any action for judicial review may be brought by a person who was a party to the proceeding resulting in the agency action, a petition for reconsideration shall first be filed with the commission in accordance with the provisions of K.S.A. 77-529, as amended by section 15 of chapter 356 of the laws of 1988.

        An action for judicial review may be brought by any person aggrieved by the agency action, whether or not such person was the petitioner for reconsideration. If no petition for reconsideration is filed, any person aggrieved by the agency action who was not a party to the proceeding before the commission may bring an action for judicial review of such agency action.

        (c)   Any action for review pursuant to this section shall have precedence in any court and on motion shall be advanced over any civil cause of different nature pending in such court. In any such action, a county abstract may be filed by the commission or any other interested party.

        History:   L. 1931, ch. 226, § 6; L. 1939, ch. 227, § 5; L. 1986, ch. 318, § 75; L. 1988, ch. 356, § 170; L. 1989, ch. 283, § 22; July 1.

• 55-607: Penalty for violations of 55-601 to 55-609. In addition to any penalty that may be imposed by the corporation commission, any person, firm or corporation, or any officer, agent or employee thereof, directly or indirectly, violating the provisions of this act shall be guilty of a misdemeanor, and upon conviction thereof in a court of competent jurisdiction shall be punished by a fine in any sum not to exceed five thousand dollars ($5,000), or by imprisonment in the county jail not to exceed thirty (30) days, or by both fine and imprisonment.

        History:   L. 1931, ch. 226, § 7; May 28.

• 55-608: Injunction and other remedies. The corporation commission, the attorney general, or any county attorney in this state, shall have the right to maintain an action in any court of competent jurisdiction in this state to enforce by injunction, mandatory injunction, and any other appropriate legal or equitable remedy, any valid rule, order or regulation made by the corporation commission or promulgated under the provisions of this act, and the courts of general jurisdiction of this state shall have authority to make and render such judgments, orders and decrees as may be proper to enforce any such rules, orders and regulations made and promulgated by the corporation commission.

        History:   L. 1931, ch. 226, § 8; L. 1933, ch. 214, § 2; March 18.

• 55-609: Assessment of costs of administering 55-601 to 55-613; disposition of moneys. (a) Subject to the provisions of K.S.A. 55-143, and amendments thereto, the state corporation commission is hereby authorized and directed to tax and assess against the parties involved in any hearing or application all or any part of the costs incurred therein and also, all or any part of the costs to the state incurred in making necessary investigations and in enforcing its orders under K.S.A. 55-601 to 55-613, inclusive, and amendments thereto, and divide such costs among the parties in such proportion as is just and equitable.

        (b)   The state corporation commission shall remit all moneys received by or for it for costs taxed and assessed under this section to the state treasurer in accordance with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of each such remittance, the state treasurer shall deposit the entire amount in the state treasury. Twenty percent of each such deposit shall be credited to the state general fund and the balance shall be credited to the conservation fee fund created by K.S.A. 55-143, and amendments thereto.

        (c)   Assessments imposed on the basis of a volume measure of production under the authority of this section shall be reported and remitted in the manner provided in K.S.A. 79-4230, and amendments thereto.

        History:   L. 1931, ch. 226, § 9; L. 1957, ch. 312, § 2; L. 1971, ch. 187, § 5; L. 1978, ch. 211, § 6; L. 1986, ch. 204, § 4; L. 1986, ch. 201, § 39; L. 2001, ch. 5, § 196; July 1.

• 55-609a: Invalidity of 55-601 to 55-609. If any section, subsection, paragraph or provision of this act shall be held to be invalid by any court for any reason, it shall be presumed that this act would have been passed by the legislature without such invalid section, subsection, paragraph or provision, and such finding or conclusion shall not in any way affect the remainder of this act.

        History:   L. 1931, ch. 226, § 10; May 28.

• 55-609b: Invalidity of 55-602 to 55-606. If any section, subsection, paragraph, sentence, provision, clause or phrase of this act shall be held to be unconstitutional or invalid for any reason, it shall be presumed that this act would have been passed by the legislature without such invalid section, subsection, paragraph, sentence, provision, clause or phrase, and such decision shall not in any way affect the remainder of this act.

        History:   L. 1939, ch. 227, § 7; March 30.

• 55-609c:

        History:   L. 1931, ch. 226, § 9; L. 1957, ch. 312, § 2; L. 1971, ch. 187, § 5; L. 1978, ch. 211, § 6; L. 1986, ch. 202, § 3; Repealed, L. 1987, ch. 206, § 1; July 1.

• 55-610: Buying or selling of illegally produced crude oil or petroleum unlawful. It is hereby declared to be unlawful for any person, firm or corporation to buy from or sell to any person, firm or corporation crude oil or petroleum produced from any oil well or wells in this state in violation of any order, judgment or decree of courts of competent jurisdiction, or of any order, rule or regulation of any body or agency authorized by law to conserve and regulate the production of crude oil or petroleum, or to take or produce crude oil or petroleum from any oil well or wells owned or operated by himself or herself or others in violation of any order, judgment or decree of courts of competent jurisdiction, or of any order, rule or regulation of any body or agency authorized by law to conserve and regulate the production of crude oil or petroleum.

        History:   L. 1933, ch. 175, § 1; March 18.

• 55-611: Same; penalties. Any person, firm or the officials of any corporation violating the provisions of this act shall be guilty of a misdemeanor, and upon conviction in any court having jurisdiction of the offense, be punished by a fine not exceeding $500 or by confinement in the county jail not exceeding six months, or both. Each day's violation shall be considered a separate offense.

        History:   L. 1933, ch. 175, § 2; March 18.

• 55-612, 55-613:

        History:   L. 1973, ch. 219, §§ 1, 2; Repealed, L. 1995, ch. 9, § 3; July 1.