DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
CONFERENCE COMMITTEE REP ORT DIGEST
HB 966 2024 Regular Session Geymann
Keyword and oneliner of the instrument as it left the House
ENERGY/CONSERVATI ON: Authorizes unitization for carbon dioxide sequestration
Report adopts Senate amendments to:
1. Change the definition of a storage unit to mean the area encompassing the underground
reservoir or portion thereof which comprises the carbon dioxide plume based on department
approved computational modeling.
2. Add introductory language explaining the general purpose of unitization, which is to ensure
that geologic storage reservoirs are developed in an efficient, fair, and equitable manner and
to prevent waste.
3. Require the commissioner to find a public and necessary purpose as a condition to issue a
unitization order.
4. Require the commissioner to make a determination providing for just and equitable sharing
of the benefits from geologic storage by interest owners and provide factors the
commissioner may consider in making the determination, including computational modeling,
any impact to a tract, the extent of impact, owned tract's proportionate share of the total
surface acreage, and the viability of any third party geologic storage projects.
5. Prohibit the commissioner's determination of just and equitable share from affecting a
contract between the storage operator and an interest owner.
6. Remove references to constitutional reservation of jurisdiction for courts over challenges to
the public purpose of the exercise of eminent domain and the right to compensation.
7. Add judicial review provisions specific to challenges to the public purpose of a unit and
whether compensation is just.
8. Remove a provision regarding proper venue for judicial review of compensation determinations.
9. Provide that orders to reduce or enlarge a storage unit must use the same method or formula
for determining the just and equitable share as used in the original unit.
10.Change the spacing of a Class VI wellhead from 500 feet from a residential or commercial
structure to 500 feet from an inhabited dwelling not owned by the storage operator or an
owner in interest.
11.Authorize the use of eminent domain in the event proposed law providing for unitization is
determined to be invalid.
12.Change notification requirement for mineral interest owners from within 10 days of the filing
of a Class VI permit to within 30 days from the Class VI permit application being deemed
administratively complete.
13.Change the area in the notice requirement applicable to persons known to the applicant,
including owners and operators acting on behalf of the person, that has the right to drill from
the area of review delineated in the application to the predicted or modeled carbon dioxide
plume as defined in administrative rules governing Class VI injections wells.
14.Make technical corrections.
Digest of the bill as proposed by the Conference Committee
Present law authorizes the commissioner of conservation to perform any act necessary to carry out
the requirements of the federal Safe Drinking Water Act related to the state's participation in the
underground injection control program and the sequestration of carbon dioxide, including the
authority to promulgate administrative rules and issue permits and orders.
Proposed law retains this authority and specifies that the commissioner is authorized to order
unitization of a reservoir for geologic storage upon the application of a proposed storage facility
operator after proper notice, public hearing, and a finding that the unit is for a public and necessary
purpose. At least three-fourths of the owners in interest within the storage unit must have given
written consent for geologic storage in order for an application to be considered. Further provides
a method for calculating three-fourths owners in interest.
Proposed law defines "carbon dioxide storage facility", "area of review", "owner in interest", and
"storage unit".
Proposed law requires the unitization order to provide for just and equitable compensation for all
owners in interest and the storage operator. Further requires the order to provide for the method,
formula, or other basis to determine the just and equitable share of the benefits.
Proposed law provides for the factors the commissioner may consider in determining the method, formula, or other basis to be used to determine the just and equitable share.
Proposed law prohibits a unitization order from varying, altering, or otherwise applying a standard
of benefit to a contract between an interest owner and a storage operator.
Proposed law requires judicial review of orders, rules, and regulations issued by the commissioner
pursuant to proposed law be conducted pursuant to the provisions and requirements of present law
governing review of the commissioner's decisions.
Proposed law authorizes the proposed storage unit operator or any owner in interest who has not
entered into a contract with the proposed storage unit operator to have the court review whether the
purpose for the storage unit is public and necessary, whether the compensation provided for is just,
and, if not, the amount of just compensation due. Further, the court's review in those instances is
limited to the compensation affecting the specific owner in interest seeking review.
Proposed law authorizes review of whether the compensation is just to be heard by a jury trial.
Further, requires the review be conducted by preference and with the greatest possible dispatch.
Proposed law authorizes the commissioner to revise a storage unit under certain circumstances,
following notice and a public hearing. Proposed law requires any order modifying a unit that
provides for compensation use the same method, formula, or other basis to determine the just and
equitable share as used in proposed law.
Proposed law authorizes the commissioner to issue orders and promulgate rules and regulations as
necessary to implement unitization for carbon dioxide sequestration.
Proposed law prohibits a Class VI injection wellhead within a unit within 500 feet of any inhabited
dwelling not owned by the operator or an owner in interest.
Proposed law authorizes the use of eminent domain in the event proposed law providing for
unitization is determined unconstitutional or otherwise invalid by a court of law.
Present law requires the commissioner to review the location plat of any drilling permit and
determine whether residential or commercial structures are situated within a 500 foot radius.
Proposed law further requires the commissioner to determine whether the area of review for any
carbon dioxide storage facility is within a 500 foot radius of the proposed drilling site.
Proposed law requires applicants for Class V and Class VI well permits to provide notice of the
application via U.S. mail to the following parties:
(1)The last operator of record for any oil or gas well located within the area of review delineated
in the application.
(2)Any person known to the applicant after reasonable search, including owners and operators, acting on behalf of the person, that presently has the right to drill into and produce from a
pool and to appropriate production either for himself or others within the area of review
delineated in the application for a Class V well or within the predicted or modeled carbon
dioxide plume for a Class VI well.
Proposed law requires the notification of a Class V well permit application within 10 days of filing
the application and requires the notification of a Class VI well permit application within 30 days of
the application being deemed administratively complete.
(Amends R.S. 30:28(D)(2), (3), (4) and (7) and (E) and 1104(A)(1); Adds R.S. 30:1104.2 and 1113)