Kansas Statutes

Chapter 55: Oil And Gas

Article 7: Production And Conservation Of Natural Gas

Statutes:

• 55-701: Waste of natural gas prohibited.
• 55-702: Definitions.
• 55-703: Regulation of production of natural gas by commission; considerations in determination of production from common sources of supply; exception for certain cities of second class.
• 55-703a: Well spacing and orderly development.
• 55-704: Rules and regulations authorized; notice and hearings.
• 55-704a:
• 55-705:
• 55-705a:
• 55-705b: Natural gas well allowable grants; procedure.
• 55-706: Proceedings before commission upon petition; designation of certain officers or employees to conduct investigations and hearings; powers; findings and recommendations.
• 55-707: Judicial review of commission's actions.
• 55-708: Penalties for violations.
• 55-709: Injunction and other remedies.
• 55-710: Receivership upon violation of act.
• 55-711: Assessment of costs of administering 55-701 to 55-713; disposition of moneys.
• 55-711a:
• 55-712: Enforcement of act; agents.
• 55-713: Invalidity of part.

• 55-701: Waste of natural gas prohibited. The production of natural gas in the state of Kansas in such manner and under such conditions and for such purposes as to constitute waste is hereby prohibited.

        History:   L. 1935, ch. 213, § 1; L. 1945, ch. 233, § 1; March 24.

• 55-702: Definitions. The term "waste", in addition to its ordinary meaning, shall include economic waste, underground waste and surface waste. Economic waste shall mean the use of natural gas in any manner or process except for efficient light, fuel, carbon black manufacturing and repressuring, or for chemical or other processes by which such gas is efficiently converted into a solid or a liquid substance. The term waste shall not include the use or flaring of natural gas if permitted pursuant to an order issued or rule and regulation adopted under the provisions of subsection (b) of K.S.A. 55-102, and amendments thereto. The term "common source of supply" shall include that portion lying within this state of any gas reservoir lying partly within and partly without this state. The term "commission" shall mean the state corporation commission of the state of Kansas, its successors, or such other commission or board as may hereafter be vested with jurisdiction over the subject matter of this act.

        History:   L. 1935, ch. 213, § 2; L. 1945, ch. 233, § 2; L. 1983, ch. 183, § 2; July 1.

• 55-703: Regulation of production of natural gas by commission; considerations in determination of production from common sources of supply; exception for certain cities of second class. (a) Whenever the available production of natural gas from any common source of supply is in excess of the market demands for natural gas from the common source of supply, or whenever the market demands for natural gas from any common source of supply can be fulfilled only by the production of natural gas from the common source of supply under conditions constituting waste, or whenever the commission finds and determines that the orderly development of and production of natural gas from any common source of supply requires the exercise of its jurisdiction, then any person, firm or corporation having the right to produce natural gas from the common source of supply may produce only that portion of all the natural gas that may be currently produced without waste and to satisfy the market demands, as will permit each developed lease to ultimately produce approximately the amount of gas underlying the developed lease and currently produce proportionately with other developed leases in the common source of supply without uncompensated cognizable drainage between separately owned, developed leases or parts thereof.

        Except as otherwise provided in subsection (b), the commission shall regulate the taking of natural gas from any and all common sources of supply within this state in order to prevent the inequitable or unfair taking of natural gas from a common source of supply by any person, firm or corporation and to prevent unreasonable discrimination in favor of any one common source of supply as against another and in favor of or against any producer in any common source of supply. In promulgating rules, regulations and formulas, to attain such results the commission shall give equitable consideration to acreage, pressure, open flow, porosity, permeability and thickness of pay, and such other factors, conditions and circumstances as may exist in the common source of supply under consideration at the time, as may be pertinent.

        The commission in determining the market demand for gas from a common source of supply shall consider the reasonable current requirements for current consumption and use within and without the state, and such other factors, conditions, or circumstances that would aid in establishing the market demand.

        (b)   The provisions of this section shall not apply to that portion of a common source of supply which is within the corporate boundaries of a city of the second class and upon which is located a producing natural gas well which is solely owned by such city and the total production from which is consumed by and for the benefit of such city. Such well shall not be allowed to be produced in an amount which exceeds two times the amount authorized by any rule, regulation or formula promulgated by the commission pursuant to subsection (a).

        The provisions of this subsection shall expire on July 1, 1988.

        History:   L. 1935, ch. 213, § 3; L. 1945, ch. 233, § 3; L. 1959, ch. 237, § 1; L. 1981, ch. 222, § 1; L. 1983, ch. 184, § 1; L. 1985, ch. 183, § 1; May 9.

• 55-703a: Well spacing and orderly development. The drilling and completion of a gas well shall not of itself entitle said well to an allowable for production; and the commission may, in its discretion, provide for well spacing in any such common source of supply and provide for the orderly development thereof.

        History:   L. 1945, ch. 233, § 4; March 24.

• 55-704: Rules and regulations authorized; notice and hearings. The commission shall promulgate such rules and regulations as may be necessary for the prevention of waste as defined by this act, the protection of all water, oil or gas-bearing strata encountered in any well drilled in such common source of supply, ascertaining the several factors entering into the determination of the productive capacity of each well, the total productive capacity of all wells in the common source of supply, the establishment of such other standard or standards as the commission may find proper to determine the productive capacity of each well and of all wells in such common source of supply, and as the commission may find necessary and proper to carry out the spirit and purpose of this act: Provided, however, That notice, as provided in K.S.A. 55-706, shall be served upon or given to the producers and purchasers of natural gas and all other persons, firms or corporations interested, of any hearing or hearings which may be called for the purpose of establishing any facts upon which any proposed rule or regulation may be based.

        History:   L. 1935, ch. 213, § 4; L. 1945, ch. 233, § 5; March 24.

• 55-704a:

        History:   L. 1945, ch. 233, § 10; Repealed, L. 1951, ch. 328, § 1; June 30.

• 55-705:

        History:   L. 1935, ch. 213, § 5; Repealed, L. 1945, ch. 233, § 13; March 24.

• 55-705a:

        History:   L. 1945, ch. 233, § 6; L. 1988, ch. 356, § 171; Repealed, L. 1994, ch. 98, § 2; July 1.

• 55-705b: Natural gas well allowable grants; procedure. An allowable may be granted by the commission for any gas well in such a manner and under such conditions as shall be prescribed by the commission in a basic proration order adopted for a common source of supply or otherwise by any rule and regulation, order or decision of the commission under the provisions of this act.

        History:   L. 1945, ch. 233, § 7; L. 1994, ch. 98, § 1; July 1.

• 55-706: Proceedings before commission upon petition; designation of certain officers or employees to conduct investigations and hearings; powers; findings and recommendations. (a) Proceedings may be instituted before the commission upon petition of any interested party, or by the attorney general on behalf of the state, or on the motion of the commission, upon any question relating to the enforcement of this act or the promulgation, revocation, amendment, renewal, interpretation, extension, or the enforcement of any rule, regulation or order, or the determination of any right thereunder, in the manner provided in K.S.A. 55-605, and amendments thereto.

        (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.

        History:   L. 1935, ch. 213, § 6; L. 1945, ch. 233, § 8; L. 1957, ch. 317, § 2; L. 1984, ch. 203, § 2; July 1.

• 55-707: Judicial review of commission's actions. Actions for judicial review of any action of the commission under the provisions of this act may be brought and proceedings respecting them shall be governed by and appeals may be taken as provided in K.S.A. 55-606 and amendments thereto.

        History:   L. 1935, ch. 213, § 7; L. 1945, ch. 233, § 9; L. 1986, ch. 318, § 77; July 1.

• 55-708: Penalties for violations. In addition to any penalty that may be imposed by the state corporation commission, any person, firm or corporation, or any officer, agent or employee thereof, violating the provisions of this act, or any valid order or rules and regulations of the commission, shall be guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine in any sum not exceeding $5,000, or by imprisonment in the county jail not exceeding 30 days, or by both fine and imprisonment.

        History:   L. 1935, ch. 213, § 8; L. 1998, ch. 122, § 1; July 1.

• 55-709: Injunction and other remedies. The state corporation commission 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 or legal or equitable remedy any valid rule, order, or regulation made by the state corporation commission or promulgated under the provisions of this act, and said court shall have the 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 state corporation commission.

        History:   L. 1935, ch. 213, § 9; July 1.

• 55-710: Receivership upon violation of act. In addition to any penalty imposed under the provisions of this act and to the remedy and relief heretofore set forth, any person, firm or corporation violating the provisions of this act, valid order, rules or regulations of the commissions shall be subject to have his, her or its producing property placed in the hands of a receiver by a court of competent jurisdiction, at the suit of the state of Kansas through the attorney general, but such receivership shall only extend to the operating of producing wells and the marketing of natural gas under the provisions of this act.

        History:   L. 1935, ch. 213, § 10; July 1.

• 55-711: Assessment of costs of administering 55-701 to 55-713; disposition of moneys. (a) Subject to the provisions of K.S.A. 55-143, and amendments thereto, the state corporation commission is hereby directed to tax and assess against the parties involved in any hearing or application all or any part of the costs incurred therein, also all or any part of the costs to the commission incurred in making the necessary investigations and the enforcement of its orders under K.S.A. 55-701 to 55-713, inclusive, and amendments thereto, and divide such costs among the interested parties in such proportion as may be just and equitable.

        (b)   The state corporation commission shall remit all moneys received by or for it for costs 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. 1935, ch. 213, § 11; L. 1957, ch. 312, § 3; L. 1975, ch. 440, § 5; L. 1978, ch. 211, § 7; L. 1986, ch. 204, § 5; L. 1986, ch. 201, § 40; L. 2001, ch. 5, § 197; July 1.

• 55-711a:

        History:   L. 1935, ch. 213, § 11; L. 1957, ch. 312, § 3; L. 1975, ch. 440, § 5; L. 1978, ch. 211, § 7; L. 1986, ch. 202, § 4; Repealed, L. 1987 ch. 206, § 1. July 1.

• 55-712: Enforcement of act; agents. The commission is hereby authorized to employ or designate such agents as may in its judgment be necessary to enforce and administer the provisions of this act, and the rules and regulations and orders promulgated thereunder; such agents, with the exception of clerical help, to be experienced in and conversant with the business of the production of natural gas.

        History:   L. 1945, ch. 233, § 11; March 24.

• 55-713: Invalidity of part. If any clause, sentence, section, provision, or part of this act shall be adjudged to be unconstitutional or invalid for any reason 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. 1945, ch. 233, § 12; March 24.