Oil and gas well bond cost
The Mississippi Board of Oil and Gas Board requires those who own or operate oil and/or gas wells to post a surety bond to legally work within the state. The required bond amounts vary which makes the premiums for these bonds also vary. The premium an applicant pays depends on their credit score. An applicant with excellent credit could pay as low as 1% of the total bond amount.
The cost for an oil and gas well bond depends on the depth of the well. The prices are as follows:
- $20,000 if the depth is from 0 to 10,000 feet deep
- $30,000 if the depth is from 10,001-16,000 feet deep
- $60,000 if the depth is from 16,0001-or more feet deep
The Mississippi Oil and Gas board may increase the required bond amount if it sees fit. Applicants must verify their required bond amount with the state prior to bonding.
These bonds are subject to underwriting, so the best way to find out exactly how much you’ll pay for your surety bond is to request a free surety bond quote now!
Why this bond
Mississippi oil and gas well surety bonds ensure that the principal (well operator) operates these wells in compliance with the provisions of the laws of the state and the rules, regulations and orders of the Oil and Gas Board. For example, all wells must adhere to regulations and have blowout preventers (BOPs) as a precautionary measures. The bond also covers the proper plugging of well or wells, the restoration of the surfaces of well or wells and the filing of all required notices and records with the board.
Don’t fall out of compliance with the laws of your state and industry!
Oil and gas well bond details
Mississippi oil and gas well bonds are in effect for one-year then they must be renewed unless claimed against or cancelled. However, the surety must give 120 days written notice to the obligee before the cancellation is in effect.
Remember, oil and gas well bond premiums vary depending on the depth of a well so it is necessary that an applicant communicates with the state to ensure the correct bond is purchased.
Become an oil and gas well operator
To become a registered oil and gas well operator, applicants must:
- Fill out a performance bond application on the Mississippi Oil and Gas Board webpage
- Post a surety bond for the correct amount
- Pay $500 permit fee
The Mississippi Oil and Gas Board web page provides all the resources an applicant needs to become an oil and gas operator. The Mississippi Oil and Gas Board link below is to their homepage and the application can be found under the publications tab.
Apply for your surety bond
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