Ordinance No. 671ORDINANCE NO.
AN ORDINANCE REGULATING THE DRILLING, COMPLETION AND
OPERATION OF OIL WELLS AND OF GAS WELLS WITHIN THE
CORPORATE LIMITS OF THE CITY OF BAYTOWN, TEXAS, AND
ESTABLISHING RESTRICTIONS THEREON; REGULATING THE
DRILLING, COMPLETION AND OPERATION OF SUCH [HELLS WITH -
IN THE CITY; REPEALING ALL PRIOR ORDINANCES REGULATING
THE DRILLING, COMPLETION AND OPERATIONS OF OIL AND GAS
WELLS WITHIN THE CITY; CONTAINING A SAVINGS CLAUSE;
PRESCRIBINI'G A MAXIMUM PENALTY OF TWO HUNDRED ($200.00)
DOLLARS; AND PROVIDING FOR THE PUBLICATION AND EFFECT-
IVE DATE THEREOF.
Section 1: Statement of Purpose and Intent of this Ordinance.
N. The City Council of the City of Baytown, Texas, finds that there
has been and there is a likelihood of additional drilling and production opera-
tions for oil and gas within the corporate limits of the City of Baytown requiring
that operations for the drilling and production of oil and gas within such area b,�
regulated because of the fire hazards created by such operations, as well as the
menace of falling derricks, unsaniiary conditions, contaminated water supply and
all similar and like threats to the lives, property, health, safety and welfare
of the public in general, for which the police power of the State delegated to
this City is to be and is hereby invoked in aid of the enforcement of this Ordin-
ance,
Section 2: Definitions:
A. For the purpose of this Ordinance, and for all purposes under this
Ordinance, the following words and terms, wherever and whenever used or appearing
in this Ordinance, shall have the scope and meaning hereinafter defined and set
out in connection with each:
(1) The word "PERSON' shall include both the singular and
plural; and shall mean and include any person, individual, firm,
partnership, association, corno:-ation, club, society, co- operative,
trust, municipal corporation or political subdivision whatsoever.
(2) The word "WELL" skidll include and mean any hole or holes,
bore or bores, to any sand, formation, strata or depth, which is or
are drilled, bored, sunk, dug or put down for the purpose of either
exploring for or ascertaining the existence of any oil, gas, liquid
hydrocarbon, or any of them, or for the purpose of producing and re-
covering any oil, gas, liquid hydrocarbon, or any of them,
(3) The words hereinafter defined shall have the following
meanings when used in this Ordinance:
(a) Oil is any liquid hydrocarbon, regardless of gravity
capable of being produced frcm a drilling unit in liquid form at the
well by ordinary production methods and which is not the result of
the condensation of gas after it leaves the reservoir.
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L
(b) Gas, as referred to in this Ordinance, means natural
gas including all of its constituent elements, which elements include
(but not by way of limitation) gasoline, condensate, distillate, butanes,
propanes and other hydrocarbons.
(c) An oil well is any well which produces one barrel or
more of oil, as hereinabove defined, to each 100,000 cubic feet of gas,
as hereinabove defined.
(d) A gas well is a well producing gas, as hereinabove de-
fined, and which produces no oil as hereinabove defined, or less than
one barrel of oil to each 100,000 cubic feet of gas.
(e) Workover - for the purpose of this Ordinance, working
over a well shall be considered to be the act of re- entering a well for
any purpose after it is initially completed or abandoned, other than for
well servicing.
(f) Well servicing includes installation or servicing of
artificial lift equipment and the removal of tubing obstructions such
as paraffin and sand.
(4) The words "REGULATED AREA", subject to the exceptions herein-
after contained, shall include and mean all lands within the corporate
limits of the City of Baytown,
(5) The word "PERMITTEE ", shall mean the person to whom is issued
a permit for the drilling and operation of a well under this Ordinance,
and his or its administrators, executors, heirs, successors and assigns.
(6) All technical or oil and gas industry words and phrases used
herein and not specifically defined herein shall have the meaning custom-
arily attributable thereto by prudent operators in the Oil and Gas Indus-
try,
Section 3: Well S acin :
A. In order that the purpose and intent of this Ordinance, as stated
in Section One (1) shall be carried out and future drilling for oil and gas within
the City of Baytown may proceed in an orderly manner, and for convenience and
clarity in identifying the location of approved or proposed drilling locations,
drilling units shall be described by use of the State Plane Coordinate System
(Lambert) for the South Central Zone of Texas. For this purpose, the corporate
limits of the City of Baytown have been divided into Blocks containing 640 acres
and being 5,280 feet square. All BLocks or portions thereof, which are located
within the corporate limits of the City of Baytown, are listed and described in
an Exhibit Mzrked "X' styled "Lambert Coordinates Describing 640 Acre Blocks with-
in the City Limits of the City of Baytown" of record in the City Clerk's office
to which reference is here made for all purposes. The boundary lines of each
Rlock shall be contiguous with all adjacent Blocks, as shown on said Exhibit "A ".
Each Block shall be identified, as shown on said Exhibit "A" by the number of
Blocks distant it is located along the Lambert Coordinates North and West, NortL
and East, South and East, or South and West from the intersection of Coordinates
3,276,000 East and 708,000 North, which intersection is about 600 feet West of
the City Hall of Baytown. For example, N2E2 will identify the Block which is the
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con-` .B" ock North and the 6econd Black East of the intersectioc i of Coordinat�:�
3,276,000 East and 708,000 North.
drilling unit for oil within, the corporate limits of the City of Baytown
shall contain 40 acres and be 1,320 feet square. Each oil drilling unit shall -r;t:
,wholly iaithir) one of the Blocks described in said Exhibit "A" and the f oui° boundar
Linea of 3ach oil drilling unit shall be contiguous to all adjacent oil drilling
uniteF. teach of the Blocks, as described in said Exhabit "A ", steal? wr,ntain 16
oil. drilling Luaus and each oil drilling unit shall be identified by numbers,
starting with the Northwest corner oil drilling? -nit of each Block and reading
from left to right for four rows, as illustrated in the example appearing on <.
plat marked Exhabit "B" styled "Example - Illustrating; the Manner in which Mac:
640 Acre Block within the City of Baytown is Divided into 4C Acre Oil Drilling
Units ", of .record in the City Clerk's office, to which reference is here made
for all purposes. The boundary lines of each oil drilling unit may be furthr;r
described by Lambert Coordinates, as `ilustrated in the example appearing in
Exhibit "B".
A drilling unit for gas within the City of Baytown shall contain 640 acre:>
and be 5,280 feet square and the boundary lines of each such gas drilling unit
shall be congruent with the boundary lines of one of the Blocks described in said
Exhibit "u".
B. (1) Not more than one oil well shall be permitted t,o be drillec.
completed and operated in each oil drilling unit and it shall be un "lavful and a
violation of thes Ordinance to drill, complete and operates more thaxi one coil 4;3-11.
in each oil drilling unit.
(2) hnything in Subparagraph B, (1) above of this aectior. 3 to
the contrary, if on the effective date of this Ordinance there exists oya any oia
drilling one or more producing oil. wells, one additional oil well may be drill.ec:,
completed and produced on the same oil drilling unit under the terms and provi,:;i ins
of this Ordinance.
(3) Not more than one gas well shall be permitted to be dri.l1.:(',
completed and operated in each gas drilling unit and it shall be unlawful and -3
violation of this Ordinance to drill, complete and operate more than one g8s7 vr:-L?
In each gas drilling unit.
(4) Anything in Subparagraph B. (3) above of this :::FCtion 3 to
the contrary, if on the effective date of this Ordinance there exist;; on any ga:S
drilling unit one or more producing gas wells, one additional gas ,roll may b
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drilled, completed and produced on the same gas drilling unit under the terms and
provisions of this Ordinance.
(5) A substitute oil well may be drilled, completed and operated in
each oat drilling unit and a substitute gas well may be drilled, completed and
operated in each gas drilling unit iil the event the prior existing iol well or
gas well, drilled after the effective date of this Ordinance, shall be abandoned.
(6) A substitute oil or gas well may be drilled, completed and
produced on the same proration unit in the event an oil well which was producing,
or capable of producing, on the effective date of this Ordinance shall be abandon-
ed. A substitute gas or oil well may be drilled, completed and produced on the
same proration unit in the event a gas �jc ll which was producing, on the effective
date of this Ordinance, shall be abandoned. No substitute well, provided for in
this Subsection B, (6) of this Section 3, be drilled to a deeper reservoir then
the deepest productive reservoir of the well for which such substitute well is
drilled.
(7) Except ns provided above in Subsection B, (6) of this
Section 3, an oil well cannot. be substituted for a gas wel3 and a has c,►el1
cannot be substituted for on oil we'L.l.
(S) The provisions of this section shall not prevent a well
from being conpleted in more than one producing horizon; multiple completions in
the same well bore are expressly authorized. In the event a well is completed
in one or more oil zones and one or more gas zone through the one -well bore, a
permit must be secured from the City of Baytown for both an oil well and a gas
well.
(9) In the event a well is drilled under an oil well drilling
permit and the permittee for any reason wished to complete the well as a gas
well, he must first secure a gas well drilling permit at no additional charge.
(10) In the event a well is drilled under a gas well drilling
permit and the permittee for any reason wished to complete the well as an oil
well, tie must first secure an oil well drilling permit at no additional charge.
G. In the event an ap�.._ication for a permit for the drilling, com-
pletion and operation of a well either for oil or gas shall be made by any person
not owning or holding leases of oil or gas rights, or drilling oontracts from
the owners of all lots, blocks or parcels of land includedin or embraced withil
a drilling unit ( as such drilling unit is described in Subsection A of this
Section 3), a permit shall be issued to such applicant, his heirs, successors
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and assigns, only upon tLe following conditions, in addition to such other ditioris as may be provided for in other section of this Urdinance, to --wit: he
permittee shall be free to eater into such contracts and agreements with the
ownwes of such other lots, blocks or tracts as he may be able to rake. If agree-
ments are not reached with all owners of lots, blocks and tracts withi.n the drill-
ing unit, then the owner or owners of any given lot or lots, block: or blocks, tract:
or tracts shall have the right or option, by notice to the permittee given in
writing within thirty (30) days after the issuance of a permit for a well on the
drilling unit involved, either (1) to tret his interest as a working interest and
contribute toward the actual cost and expense of drilling, completing and operati.r3,_
said well with all mecessary appurtenances currently each month in the proportion..
that "Uhe number of square feet in area owned by him in the drilling unit bears
the total number of square feet in area owned by him in the drilling unit nears to
the total n,.amber of square feet embraced in said unit, and thereupon receive the
same proportion of the oil produced and saved from such well., or its value: at tliie
well, at the option of the permittee, and a like proportion of natural gas producer,,
saved and utilized or sold, or the value of same at the well, at the option of
the permittee,, or (2) to treat his interest as a royalty interest and receive,
delivered free of cost in the pipe line to which the well may be connedted, a
share of all oil. produced and saved 1`1om such well equal to oiie- eighth (1/8t1h) of
the proportion of the whole quantity of iol and casingheas gas so produced and
saved that the number of square Peet in the area owned by him bears to the total
number of square feet in such drillL g unit, or at the election of permittee, to
receive such proportion of the value at the well of the oil so produced, and to
receive a like proportion of the gas and casinghead gas produced, saved and
utilized or sold, or at the election of permitted, the market value at the well of
such proportion of gas or casinghead gas produced and sold or used off the
premises, or, for gas sold at the well, such proportion of the amount realized
from such sale. If any owner does not exercise the right and option above pro-
vided, the obligation shall then be upon the permittee, his heirs, successors and
assigns to make settlement with such owner on the terms provided in Option (2)
above, providing for the payment of a one - eighth (1 /8th) royalty. If the owner
of a lot or lots, block or blocks, tract or tracts shall exercise Optaozi (1) ab«tif.
and treat bin interest as a working Interest, as therein provided, the pern:itteo
shall be entitled to reimburse himself for such owner's proportionate part of th�
cose out of such owner =s proporationate part of the iol, gas and casingheas gas,
or the value thereof, before making deliveries of products or settlement for the
value thereof. If Option (1) is exercised by the owner of any lot or lots, block
or blocks, tract or tracts, such owner tihzj.11, , within ti .:;: me tarovided for notice
t Forth, file.14te the Director of iuLlie Works.and
Engineering a 'bonci Dr uoh.5v co: i.gatipr1 ex::c°uted,by, such owner- as principal and,
by an, authorized sta.ety company as surety, in =.which sn-_ n principal and surety
agree:,:'bind and obli., themselves to pay, to •thc - periilittee, his heirs, successors
and assigns, currently � ch month, that proportion of the actual and necessary
cost and expenses, involved in -the drilling, completion and' operation ,,of such well
that the number of sc1uL_,i,c elibracod-t:ith].n thc lot or lots; block or blocks,
tract or tracts of such c,,ner bears to thf: total number of ;3c±uarc i'cLelt in su lh
drillini unit, such 'bond to be approved by the City Attorney and halci key the
Director of Public: 'Work;., and. Engineering: for the benefit of-the beneficiaries
therein. Fer::ait., Ghall be issued in all cases and shall be subject to the pt4o-
visions of S:ction 7 hereof and 'upon "the condition that -the permittee, his heirs,
successors and assigns, shall make sdttlement in, accordance_with..the:provisions
thereof.
D. In case there be applications filed with,the Director of Fublic
A.
Works and 'Engineering and pending at the same time, for permits :.o drill a well. .
in any one drilling unit, as des=gnated in Subsection `, of SectHoia 3 of this
Ordinanc,.z by more than one appl4cant;.that application shall be granted, if
atherwi .t. s ufficient, which sh.-.11 be made by the person holding the greater area
of the land, vi.thin the drilling unit by ownership in fee, or by lease or other
contract Ash ,!he owner or owners, pert?sitting the drilling thereon for oil or gas.,
1. she interests of persons other than the permittee uho hold oil
and gas leases oi, equivalent.contratcb,.in any drilling unit,a.as designated in
Subsection A of Sectiori 3 of this Ordinance, shall be treated as part of the. total
working interest of said drilling unit, and such other persons holding such in-
terests shall each make the following election w th permittee within thirty(30)
days from the date of the issuance of a permit with respect to a drilling unit=
Either (1) agree in writing with pern:ittee to contribute their share of,' -a11 coats
...and expenses, properly allocated to said well. and drilling tw.it.'by peimittee in
accounting. practice, currently each. month in the proportion that thy, number of
A?
square feet inthe area held by them or each :of ,then in the drilling unit bears
to the total number of square feet -embraced in said unit; and within said thirty
"30) clay per Lnd,, executti. a.::;_ file ,- .th. tho Director az Da alic ':1or=�Q �SnG
&�,gineering i bond w %w i an authorizes uu:;°ety:,company as surety in �.:n amount ra-
Presenting that portion of the estima 0d maximum cost of the well. that- the area
of land held in fee simple under lease or other contract by the principal bears to
the whold area of the drilling unit, conditioned that the principal in the bond
will pay to the permittee and his assigns such proportion of the cost of drilling;
and operation thereof, such bond to be approved by the City "ttorney and held by
the Director of Public Works and Engineering for thebenefit of all persons in-
terested; and thereupon said persons so acting shall be entitled to participate in
the total irorking interest under said unit; and said persons so acting shall have
the right upon reasonable notice given to the permittee, upon the furnishing of
stroage tanks of facilities for handling the same, and upon the payment of or
securing the payment of their share of the royalty interests and any overriding
royalty or oil payment interest thereon, to receive in kind their propertionate
share of oil and gas produced and saved from the well in said drilling unit and
allocated to the working interest of said well. Or, (2) if such other persons.,
orany one or more of then, fail to elect under (1) above within said thirty (30)
day period, then he or they shall be deemed to have elected to agree that permittee
shall be entitled to reimburse himself currently each month from such other persons
proportionate share of the proceeds of sale or production in kind for twice the
amount of such other person's proport -Jonate part of the costs and expenses as set
out in Option (1) above. Provided, however, that permittee and such other persons,
or any one or more of them, shall be able to alter the obligations as set out in
this section by an agreement made by them in writing; provided such agreement is
not repugnant to other rules and regulations set out in this Ordinance.
Section 4. APPLICATION AND FILING FEE
A. Any person desiring to drill, complete and operate a well for
oil or gas within the regulated area of the City of Baytoum shall present an
application in duplicate therefor to the Director of Public Works and Engineering,
which application shall be in writing, addressed to the Mayor of the City of
Baytown, be signed by the applicant of some person duly authorized to sign same
for the applicant, and shall state:
(1) The date of said application;
(2) The name and address of the applicant and if the applicant
is a corporation, the state of incorporation, and of applicant is a partnership,
the names and addresses of the general partners;
(3) The number of the drilling unit, the particular lot and
block number of tract in the drilling unit on whit, the proposed well is to be
located and the exact location of the proposed well by .Lambert Coordinates;
depth of the well;
(4) The type of the well, wh &ther oil or gas, and the proposed
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(5) The proposed complete casing program of the well; and
(6) The exact and correct number of square feet in the drilling
unit over which the applicant has control of oil rights or gas rights, to the end
that the application will show what proportion and what parts of the drilling unit
the applicant owns in fee, or holds under lease or drilling contract from the owners,
and applicant shall be required to own in fee, or hold under lease or drilling con-
tract from the owners more than 20 acres (hereinafter in this sub - paragraph (6)
called "Required Acreage ") of the acreage within a drilling unit before a permit may
be issued; provided, however, in the case of a gas well at least the required acreage
shall be located within whichever 40 -acre oil drilling unit, out of the gas drilling
unit, on which said well is to be drilled.
(7) Attached to the application for permit letter shall be:
(a) A plat prepared by a duly licensed surveyor showing the
exact location of the proposed well with respect to the drilling unit boundaries and
with respect to the boundaries of the lot or block on which applicant has secured
the rights from the owner to drill; designation of lots, blocks or tracts owned or
controlled by the applicant within the drilling unit, and the distances from the well
location to all parks, streets, alleys or other public property, residences, commer-
cial buildings and structures situated within two hundred (200') feet of the well
location.
(b) A copy of Railroad Commission Form 1:
B. Each application shall be accompanied by a cashier's check in
the amount of Two hundred and Fifty ($250.00) Dollars, made payable to the City of
Baytown, Texas, which shall be a filing fee. Each supplemental application shall
furnish the information and conform with the requirements set forth in Subsection A
of Section 4 of this ordinance, insofar as the same are relevant to the authority
requested therein, but need not be accompanied by any additional filing fee. Each
application or supplemental application shall be filed by the Director of Public
Works and Engineering and kept as a part of the public records of the City of Bay-
town, Texas.
Section 5: FILING OF APPLICATION OR SUPPLEMENTAL APPLICATION AND NOTICE':
A. An application to drill, or a supplemental application, shall be filed
with the Director of Public Works and Engineering for action in issuing or refus-
ing to issue a permit.
B. Notice of the filing of each application shall be given by the applicant
_g_
to each owner and lessee of lots, blocks and tracts within the drilling unit
described in the sgplication now awned by or under lease to the applicant as
such ownership is disclosed by the Deed Records of Harris County, Texas. Such
notice shrill be in words and gigures, as follows:
Notice is hereby given that � acting
under and pursuant to the terms and provisions of hN
ORDINlM MULATICII TIC DRILLIM, COMPLETION .r_IJD
OPERATION OP OIL MLS AND OF G '.S :ELLS WITHIN TIC,
CORPORATE LIJUS OF THE CITY Or DAYTOUN, TEXkS, AND
ESTNBLISHING RESTRICTION THEMON, being Ordinance
No. , and any and all ordinances amendatory
thereof, did on the --- day of
file with the Director of Public Works and Engineering
of the City of Baytown an application to drill, complete
and operate a well for oil (or gas) upon Lot No.--- _
Block No._ , (or other appropriate description),
City of Baytown, Texas, as per map of record in
`dolume Page , Plat Records of
Harris County, Texas, in Drilling Unit No.
and located by Lambert Coordinates for the South central
zone of Ten as at the intersection of Coordinates_._
East and North.
At least ten (10) days prior to the granting or refusal of an application,
a copy of such notice shall be mailed by registered mail at expense of the
applicant, addressed to the last known address of each owner and lessee of lots,
blocks and tracts in sail drilling unit not owned by or under lease to the
applicatint; and a copy of such notice shall be published, at the expense of
applicant, in every issue of a daily newspaper of the City of Baytown, Texas,
for ten (10) days prior to the data of the granting or refusal of sue!!
application. Proof of such publication shall be made by the printer or publisher
of the newspaper by affidavit filed with the Director of Public Yorks and Engin-
eering and shall be prima facie evidence of such publication. The applicant shall
file with the Director of Public [corks and Engineering an affidavit showing
(a) the same and last known address of each owner and lessee of lots, blocks and
tracts to whom nolide is required to be gived as hereinnhouFe provided, and (b)
the manes of each owner and lessee of lots, Mocks and tracts to whom such
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notice is required to be given and whose addresses are unknown to applicant.
Section 6. WELL LOCATION
A. No well shall be drilled and no permit shall be issued for any
well to be drilled in any location within a drilling unit which located nearer
than two hundred (200) feet from any residence or building without the applicants
having first secured the written permission of the oimer or owners thereof,
nor shall any well be drilled within any of the streets of alleys, parks or
other public property unless authorized by an ordinance duly passed by the City
Council of the City of Baytown, Texas.
Section 7_ NECESSITY OF CON'T'RACT WITH SURFACE MINER
A. Neither this Ordinance nor any permit issued hereunder shall by
interpreted to grant any right or license to the permittee to enter upon, use or
opcupy in any respect for tae drilling of operation of any well on any surface
land except' by the written contract of the surface owner unless the pernittee
obtained such right in an oil and gas lease, or other contract; nor shall it
limit or prevent the free right of the oimer to contract for the mount of
damages, rights or privileges with respect to his own land and property.
Section S. ISSUANCE OR REFUSAL OF PEP,MIT
A. If, after such application of supplemental application is filed
pursuant to this Ordinance, it be found by the Director of Public Works and
Engineering to comply in all respects with terms of this Ordinance;, and the
drilling and operation or deepening and operation of a well is not prohibited
by the terms of this Ordinance, then the Director of Public lJorks and
Engineering shall issue a permit fcDr the drilling and operation or deepening and
operation of the well applied for. The ;ranting and issuance of a permit for a
well on a drilling unit, as provided in this Ordinance, shall automatically
operate as a rejection and denial of all other pending application or applica-
tions for a well or wells to be completed upon the drilling unit involved, or
any portion or portions thereof.
In the event the Director of Public Works and Engineering should deny the
applicant a permit to drill or Mepen a well, an appeal to the City Council may
be made by such applicant by filira.g written notice of appeal with the City Council.
Such appeal shall be heard by the City Council within thirty (30) days after the
filing date.
Fb. Each permit issued. under this Ordinance shall (1) by reference
have '14 orporated therein al-1 provisions of this Ordinance with the same force
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and effect as if this Ordinance were copied verbatim in said permit; (2) specify
definitely the location of the well and the number of the drilling unit in which
the well is to be located; (3) specify that drilling shall begin within ninety
(90) days from the date of the permit or said permit shall be forfeited; provided
however, such forfeiture shall not affect the right of applicaht to apply for a-
nother permit; (4) specify that such permit shall remain in full force and Affect
until sai4 well is abondoned.
C. Said permit shall not be issued until the provisions of Section
9 and 10 of this Uydinance are complied with. Said permit, in duplicate originals,
shall be signed by the permittee. One original of the permit duly executed,
shall be delivered to the permittee and one original of the permit, duly
executed, shall be retained and filed by the Director of Public Works and
Engineering, and , when so filed, shall constitute the pernittee's drilling
and operating license and the contractual obligations of the permittee to comply
with the terms of such permit, of the bond hereafter mentioned and of this
Ordinance.
Section 9. BOND
A. If the issuance of a permit be authorized, game shall not be
issued until the applicant shall file with the Director of Public Works and
Engineering a bond, executed by the permittee as a principal and by a good and
sufficient corporate surety company Licensed to do business in the State of Texas
as surety, and whose name appears on the current list published by the United
States Treasury Department of accepted sureties on Federal bonds, conditioned
that the principal obligor will drill and operate said well in strict accordance
with the terms of this Ordinance; that the principal will remedy any and all
damage to streets, curbs, gutters, water lines, fire hydrants and other public
property, occasioned in any manner by nis or its drilling of said well. Such
bond shall inure to the benefit of the City of Baytown; shall be in a form to
comply herewith, and shall be in the amount of Fifty Thousand and No/100
($50,000.00) Dollars, and shall be approved by the City kttorr.ey. A permittee
shall not be required to post additional bond if he has approved bonds on file
with the city as required by this Section 9 totaling One Hundred Thoudand and Nof
100 ($100,000.00) Dollars.
B. Failure to keep said bond in full force and effect, in
accordance with the terns hereof shall cause a revocation of the permit and shall
be unlawful and punishable in accordance herewith.
Section _10.__ PUBLIC LIABILITY AND PROPERTY DAMAGE
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A. Said permit shall not be issued until the applicant shall also
file with the Director of Public Works and Engineering of the City of Baytown a
memorandum copy or certificates of a policy or policies of public liability and
property damage insurance, issued by an insurance company or companies authoriz-
ed to do business in the State of Texas, to be approved by the City Lttorney,
the amount of which policy or policies of insurance for liability for bodily
injury or death of one person shall not be less than One Hundred Thousand and
No /100 (100:000.00) Dollars, and for any one accident, not less than Three
Hundred Thousand and No /100 (43002000.00) Dollars, and the amount of such policy
or policies for damage to property of others shall not oe less than One Hundred
Thousand and No /100 (:100,000.00) Dollars. The terms and conditions of such
policy or policies covering such operations are to be such as to assure persons,
firms or corporations against loss by liability imposed by law by reason of any
accidental personal injury ordeath to any person other than the assured or his
employees, or by reason of any such loss or damage to property of any person,
firm or corporation other than assured or his employees. Each policy of insur-
ance shall contain a provision obligating the insurer to give the City Council
of the City of Baytown written notice of cancellation not less than fifteen (15)
days prior to the date of cancellation. Application shall, upon request of the
Director of Public Works and Engineering, submit the original or a certified
copy of any policy for inspection at any tune.
B. Irrespective of the requirements as to insurance to be carried,
the insolvency, bankruptcy or failure of any insurance company carrying insurance
for any application or permittee hereunder, or the failure of any such company
to pay claims accruing shall not be held to waive any of the provisions of this
Ordinance. Application shall pay promply all premiums for such insurance in
strich accordance with its obligations to its carrier or carriers and to maintain
the above described coverage in full effect so long as the permit shall be
valid and alive.
C. Failure to keep said policy or policies in full force and effect,
in accordance with the terms hereof, shall be unlawful and shall be punishabel
in accordance herewith.
Section 11. RIAWFUL TO PERMIT ESCAPE OF MUD ETC.
A. It shall be unlawful for any person to permit to escape mud,
water, oil,, slush or other waste matter related to the drilling or operating of
any oil and/ or gas well into any adjoining lots upon which permittee does not
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have Lease;:: s =r other contractual rights to use the surface, or upon leases not
owned by pernittee or into the alleys, streets, gutters or sewers of the City
of Baytown; and within fifteen 05 ) days after th4Fe completion or abandonment of
any oil or gas well9 the mud and other similar matter and a material used in
connection with the drilling and operations thereon shall be removed from the
premises.
Section 12, ITHOL7 A PETUIT
L. It shall be unlawful and an offense for any person acting either
for himself or as agent, employee, independent contractor, or servant of any
other person, to commence to drill, to drill, or to operate any oil or has well
within the regulated area of the City of Baytown or to work upon or assist in
any way in the prosecution or operation of any such well without a permit for
the drilling and operation of such well hav ing first been issued in accordance
with the provisions of this Ordinance.
Section 13, BEEPER. DRILLILG
A. Unce any well has either been completed as on oil or gas Produc-
er or abandoned as a dry hole, it shall be unlawful and ai' offense for any
person to drill such well to a greater depth than that reacted in the prior drill
ing operations without the permittee, as to such well, obtaining a supplemental
permit after filing a supplemental application with the Director or Public
:forks and Rigineering specifying (1) the glen condition of the well and the
casing therein; (2) the depth to wh;.ch it is proposed such well be deepened,
and (3) the proposed casing program to be used in connection with proposed deep-
ening operation. In any deeper drilling or any deeper completion, or any
deeper production operations, the permittee shall comply with all other pro-
visions contained in this Ordinance and applicable to the drilling, completion
and operation of a well or wells, but no additional filing fee shall be required.
Sect io I WELL WORKOVEFi.._
Any person operating any well or wells for oil or gas within the corporate
limits of the City of Baytown, Texas, may perform any well workover operation:.,
except drilling deeper, without a prior permit, provided the operator complies
with all safety rules set forth in thes Ordinance and no additional filing fees
will be required for such work; however, no well workover shall be started or
performed without first informing the City Manager of Baytown. It will not be
necessary to inform the City Manager when well servicing is to be performed
except for swabbing operations.
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Section 15. RULES FOR DRILLING AND .PRODUCING OPERA MNS
A. All persons engaged in the drilling and operation of diil and /or
gas wells within the corporate limits of the City of Baytown shall comply with
the following rules and regulations:
(1) In order to enable the holder of each permit to move oily
gas, ,rater or other products to or from each drilling unit within the city limits
of the City of Baytown, the holder of each permit issued under this Ordinance
for the drilling and operation of a well for oil or gas in the City of Baytown
shall apply to the City Council for an easement on, over, under, along or across
the City streets, sidewalks, alleys and other City property in the City of
Baytown for the purpose of construction, laying, maintaining, operating, re-
pairing, replacing and removing pope lines so long as production or operations
may be continued under any permit issued pursuant to this Ordinance; provided,
however, such permi.ttee shall (a) not interfere with or damage existing water,
sewer or gas lines or the facilities of public utilities located on, under or
across the course of such rights of way; (b) furnish the Director of Public Works
and Engineering with a plat shaowin the location of such pipe lines; (c) con-
struct such lines or cause same to be constructed out of new or reconditioned
pipe in accordance with directions of the Director of Public Works and
Engineering and properly cased and vented if under a street; and (d) grade, level
and restore said property to the same surface condition, as nearly as practicable,
as existed when operations for the drilling of the well were first commenced.
(2) Any violation of the law of the State of Texas or any rules,
regulations or requirements of any State or Federal regulatory body having
jurisdiction in reference to drilling, completing, eq#ping, operating, producing,
maintaining or abandoning an oil o-x gas well or related appurtenances, equipment
or facilities, or in reference to fire wall, fire protection, blowout protection,
safety protection or convenience of persons or property, shall also be a violat-
ion of this Ordinance and shall. he punishable in accordance with the provisions
hereof.
(3) No persons engaged in drilling or operating any well shall
permit gas to escape or be vented into the air unless said gas be flared and
burned. All gas flared or burned from a torch, pipe or other burning device,
within the City of Baytown must be done in such manner so as not to constitute a
fire hazard to axly property; and the location of the torch, pipe or other burning
device, the construction thereof, the mair:tenance thereof, and the operation
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thereof shall at all times be in full compliance with such regulations as may
from time to time be issued by the Fire Chief of the City of Baytown.
(4) It shall be unlawful and an offense for any person to use
or operate ixi connection with the drilling or working over of any well within the
city limits of Baytown, an# wooden derrick or steam powered rig, or to permit
any drilling rig or derrick to remain on the premised or drilling site for a
period longer than sixty (60) days after completion of abandonment of the well.
All engines shall be equipped with effective mufflers.
(5) Two dual - controlled, fluid- operated blowout preventers with
working pressures equal to the maximum anticipated wellhead pressures shall be
used for all drilling or completion operations involving the use of drill pipe
or tubing after the surface casing has been set. The mechanical operation of
the preventers shall be checked every twenty -four (24) hours and shall be tested
with pump pressure with enough frequence to insure good working order at all time.
(6) Only portable steel slush tanks for mud or water shall be
permitted in connection with the drilling and working over operations of any well.
(7) t�my person drilling or operating a well for oil or gas shall
make adequate provisions for the disposal of salt water or other impurities which
may be produced along with the oil or gas in such a manner as not to contaminate
the water supply of the City of Baytown or destr9y vegatation.
(8) No well shall be drilled or working over in the City of
Baytown without the bore hole at all times being filled with drilling fluid of a
weight and viscosity as a reasonably prudent operator would use to keep the well
under control at all times.
(9) It shall be unlawful for any person in connection with the
drilling or working over operations of any well within the City of Baytown to
conduct any swabbing operations or to take and to complete any drill stem test or
tests except during daylight hours. Drill stem tests may be conducted only if the
well effluent during the test is produced through an adequate oil and gas separ-
ator to storage tanks, and the effluent remaining in the drill pipe at at the time
the tool is closed is flushed to the surface by circulating drilling fluid down
the annulus and up the drill pipe. The City Manager of Baytown shall be informed
before drill stem testing or swabbing is performed so that a city representative
may be present during such operations.
(10) The operator of any well in any field or area within the
City of Baytown, Texas, shall be required to set and cement a sufficient amount
of surface casing to properly protect all fresh water sands as specified by the
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Texas Water Commission and the City Manager of Baytown. A minimum of twelve
hundred (1,200') feet of surface casing shall be set. The surface casing shall be
of new or reconditioned casing and shall be set and cemented in accordance with the
rules, regulations and orders of the Railroad Commission of Texas for the field area
in which the well is to be drilled. Cementing shall be by the pump and plug method
and sufficient cement shall be used to fill the calculated annular space back of the
casing to the surface of the ground. Tf returns to the surface of the ground are
not realized, then a temperature survey must be conducted to find the location of
the cement and necessary work performed to provide continuous unbroken cementing
from the shoe of the casing to the surface of the ground. The cement shall be
allowed to stand for a period of twenty -four (24) hours before drilling plug. If
more than twelve hundred (1,200') feet of surface casing is required, in lieu of
setting the full amount of surface casing required to protect fresh water sands, the
applicant may use the multistage cementing process on the next casing string. In
using the multistage cementing process, sufficient cement shall be used in the stage
cement job that is equivalent to the volume of the annulus from the cementing tool
to the surface of the ground. Should the cement not reach the surface of the ground,
a temperature survey must be conducted and if the survey shows that the top of the
cement is less than one -third (1 /3rd) of the distance from the shoe of the surface,
casing the surface, then corrective measures must be taken. Any applicant using the
multistage process must file with the Director of Public Works and Engineering a copy
of the Railroad Commission of Texas letter granting such permit and an affidavit
from the company performing the cementing, Failure to file either of these shall
be unlawful and shall be punishable in accordance herewith.
In any well drilled in any field or area within the City of Baytown, the
producing string of casing shall be of new or reconditioned pipe which has been
tested and withstood the maximum anticipated pressure to be encountered. Cementing
shall be by the pump and plug method and sufficient cement shall be used to fill the
calculated annular space back of the casing to a point at least six hundred (600')
feet above the shoe or the productive zone, whichever is applicable; and the cement
shall be allowed to stand for a period of twelve (12) hours before drilling plug or
until a compressive strength of 500 psi is obtained. After cementing, the casing
shall be tested at a pressure in pounds per square inch calculated by multiplying
the length of producing string by two - tenths (0.2), being maximum test pressure re-
quired. If at the end of thirty (30) minutes the pressure shows a drop of (10) per
cent or more of the above required test pressure, the casing shall be condemned.
After corrective operation the casing shall again be tested in the same manner.
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(11) Before drilling and setting casing in any well for oil or
gas within the corporate limits of the City of Baytown, the permittee must contact
the Director of public Works and Engineering of the City of Baytown, and Texas
Water Commission and obtain letters stating where the fresh water sands are to be
found in the area or field in which the well is to be drilled. k copy of the Texas
Water Commission's letter must be filed with the Director of Public Works and En-
gineering and the permittee must set sufficient surface casing as required. Failure
to file a copy of the Texas Water Commission's letter shall be unlawful and shall
be punishable in accordance herewith.
(12) All completed wells within the City of Baytown shall be
equipped with Christmas tree fittings and wellhead connections, with a rated working
pressure equal to or greater than the surface shut -in pressure of the well. All
wellhead connections shall be assembled and tested prior to installation by a fluid
pressure which shall be equal to the test pressure of the fitting employed.
(13) Whenever any well is abandoned within the city limits of
Baytown, it shall be the obligation of the permittee to plug such well in accordance
with the rules and regulations of the Railroad Commission of Texas and to take any
and all additional provisions or precautionary measures prescribed by the State of
Texas or the Railroad Commission of Texas in connection with abandonment and plug-
ging of the well.
It shall be the further obligation of the permittee or the operator of the
well to cut the surface casing off at least six (b') feet below the surface of the
ground and to place at least a twenty -five (25') foot cement plug in the top of the
casing and to weld the top of the casing completely shut. The resulting hole in
the ground must be completely filled to the surface of the ground and duly tamped.
(14) It shall be unlawful and an offense for any person to use,
construct or operate in connection with any producing well within the city limits
of Baytown any crude oil storage tanks except to the extent of two (2) steel tanks
for oil storage, not exceeding 500- barrel capacity each, and so constructed and
maintained as to be vapor tight and each surrounded with an earthen fire wall at
such distance from the tanks as will, under any circumstances, hold and retain at
least two and one -half (2 -1%2) times the maximum capacity of such tank. A permittee
may use, construct and operate a steel conventional separator, and such other steel
tanks and appurtenances as are necessary for treating oil with each of such facili-
ties to be so constructed and maintained as to be vapor tight. Each oil and gas
separator shall be equipped with both regulation pressure relief safety valve and
a bursting head.
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(15) Any person may install equipment for the purpose of
secondary recovery or pressure maintenance operations or for automatic lease
operations provided that such person must comply with all safety requirements of
this ordinance and of the Railroad Commission of Texas.
(lb) It shall be unlawful for any person within the corporate
limits of the City of Baytown to install any fired vessel or open flame nearer
than One Hundred Fifty (150') feet to any well or storage tank.
(17) all wellheads, tank batteries, pumping units and equipment
appurtenant thereto within the City of Baytown which are located within a densely
populated area, as determined by the City Manager, or nearer than One Hundred (100')
feet to a public street, shall be adequately protected by a fence so constructed
that it will prevent easy entry; however, any wellhead, tank battery, pumping units
or equipment appurtenance thereto which are located on any lease, tract or farm,
which is fenced in its entirety will require no additional protection other than
that commonly used by prudent operators. Fences to prevent easy entry shall be
approved by the City Manager or his delegates.
(18) The premises shall be kept in a clean and sanitary condition,
free from rubbish of every character, at all times, during the drilling operation
and as long thereafter as oil and /or gas is being produced therefrom. All permit -
te's premises shall be kept clear of high grass, weeds and combustible trash or any
other rubbish or debris that might constitute a fire hazard within a radius of One
Hundred (100') feet around any oil tank or tanks, or producing wells, or to the
limits of premises, whichever is the lesser.
(19) No prime movers shall be permitted within the corporate
limits of the City of Baytown for the purpose of pumping wells, except electric
motors; provided, that non - electric motors may be used, in the event of an unusual
hardship, with approval of the City Manager.
(20) Printed signs reading "DANGER, NO SMOKING ALLOWED" or
similar words shall be posted in conspicuous places on each well, storage tank or
battery of tanks, within the corporate limits of the City of Baytown.
(21) Material, equipment, tools or pipe used for either drilling
or producing operations at the well shall not be delivered to or removed from the
well site except between the hours of 7:00 A.M. and 7;00 P.M, of any day except in
case of emergency.
(22) It shall be unlawful to block or encumber, or close up any
streets or alleys in any drilling or production operations, except by an ordinance
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duly passed by the City Council permitting a temporary closing of a street or alley.
Section 16: RELEASE FROM BOND:
A. If and when any permit shall terminate and become inoperative as
in this ordinance provided, or if and when the permittee shall file with the City
Clerk written notice of his election to surrender his permit and abandon the premise,
covered thereby, then if no claims or lawsuits under the bond or bonds shall be
pending or have been filed within six (6) months after said permit shall have ter-
minated, become inoperative, or written notice of election to surrender has been
filed, the City Clerk shall return the bond or bonds furnished by the permittee in
connection with such permit; and if claims are pending or are filed within such time
upon the satisfaction or defeat of such claims or lawsuits, such bond or bonds shall
thereupon be returned to the permittee.
Section 17: NOT APPLICABLE TO CERTAIN WELLS:
A. Anything contained herein to the contrary notwithstanding, none
of the provisions of this ordinance except Sections 9, 10 and li hereof and para-
graphs A (2), (3), (4), (5), (6), (7), (8), (9), (12), (13), (15), (16), (17), (18),
(19), (20), (21) and (22) of Section 15 hereof shall ever be construed as applying
to the operation of any producing oil or gas well located within the corporate
limits of the City of Baytown which was drilled and completed prior to January 1,
1950, or to the equipment and its operation (producing or otherwise), installed in
connection with such well on the leased premises; and provided, further, without
limitation on the foregoing, nothing contained herein shall be interpreted to re-
quire a permit for any producing oil or gas well now located within the corporate
limits of the City of Baytown which was drilled and completed prior to January 1,
1950, or for the continued operation, reworking, sidetracking, plugging back or
abandonment or deepening through the aepest productive reservoir to which any such
well was previously drilled.
Section 18: SPACING PROVISION NOT.APPLIC4MLE TO PIEf{ EMENT -TYP SALT DOMES:
The well spacing provisions of this ordinance shall not apply to producing
areas which heretofore, prior to effective date of this ordinance, or may be in
the future defined as piercement type salt domes by the Railroad Commission of
the State of Texas. One field, namely Goose Creek, within the City limits of Bay-
town is presently defined as piercement type salt dome.
The 40 -acre drilling units within the Goose Creek Field which are exempt
from the spacing provisions of this ordinance are listed in an Exhibit marked "C',
styled "Lambert Coordinates Describing Oil Drilling Units Within the Producing
Limits of the Goose Creek Field, "and such Exhibit being of record in the City
Clerk's office, to which reference is here made for all purposes.
Section 19: REPEALING CLAUSE:
All ordinances or parts of ordinances heretofore passed or enacted by "the
City of Baytown regulating the dril'.ing, completion and operation of oil and/or gas
wells within the corporate limits of the City of Baytown are hereby expressly
repealed.
Section 20: SAVINGS CLAUSE:
If any provision, exception, section, subsection, paragraph, sentence, clause
or phrase of this ordinance or the application of same to any person or set of cir-
cumstances shall for any reason be held unconstitutional, void or invalid, such
invalidity shall not affect the validity of the remaining provisions of this ordin-
ance or their application to other persons or sets of circumstances and to this end
all provisions of this ordinance are declared to be severable.
Section 21: PENALTY:
Any violation of any of the terms of this ordinance whether herein denominated
as unlawful or not, shall be deemed a misdemeanor and any person convicted of any
such violation shall be fined in a sum not exceeding Two Hundred ($240.00) Dollars.
Each day of the continuation of such violation shall be considered a separate of-
fense, and be punished separately; and any person, agent or employee engaged in any
such violation shall on conviction be so punished therefor.
Section 22: EFFECTIVE DATE:
This ordinance shall take effect from and after ten (10) days from the date
of its passage by the City Council. The City Clerk is hereby directed to give
notice hereof by causing the caption of this ordinance to be published in the of-
ficial newspaper of the City of Baytown at least twice within ten (10) days after
the passage of this ordinance.
INTRODUCED, READ and PASSED by the affirmative vote of a majority of the City
Council of the City of Baytown, on this the 14th day of February, 1963.
Al Clayt6A, Mayor
ATTEST:
Edna Oliver, City Clerk