DEPARTMENT OF CONSERVATION, DEVELOPMENT ‑- OIL AND GAS CONSERVATION ACT OF 1951 ‑- APPLICATION AND REGULATIONS

DEPARTMENT OF CONSERVATION, DEVELOPMENT ‑- OIL AND GAS CONSERVATION ACT OF 1951 ‑- APPLICATION AND REGULATIONS

The effective date of the provisions of the oil and gas conservation act was ninety days after the 1951 session of the legislature.  The enactment date of the rules and regulations was January 18, 1954.  However, certain provisions of the law and the rules and regulations can be applied to wells drilled prior to 1951.

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                                                                    June 3, 1957

Honorable Earl Coe
Director
Department of Conservation
General Administration Building
Olympia, Washington                                                                                                                Cite as:  AGO 57-58 No. 77

Dear Sir:

            This is in answer to your request for an opinion on the following questions interpreting the provisions of the oil and gas conservation act of 1951 (chapter 78.52 RCW).

            (1) May the provisions of the act be applied to oil or gas test wells that were drilled but not abandoned prior to the effective date of this law?

            (2) Can the rules and regulations promulgated under the act and adopted January 18, 1954, be made to apply to wells which were drilled after the effective date of the oil and gas conservation act of 1951, but prior to January 18, 1954, and on which drilling operations continued beyond January 18, 1954?

            (3) Should the plugging requirement contained in the act and the rules and  [[Orig. Op. Page 2]] regulations adopted January 18, 1954, be made to apply to a well which was drilled February 16, 1949, and completed later the same year, but on which no work has been done since 1953, although the well has not been abandoned?

            In answer to your questions, the provisions of the act and the rules and regulations are effective as of the date of their enactment.  However, certain sections of the statute and the rules and regulations are applicable to wells which were in existence at the time of the enactment of the law and the adoption of the rules and regulations.

                                                                     ANALYSIS

            RCW 78.52.001 (§ 1, chapter 146, Laws of 1951), known as the oil and gas conservation act of 1951, contains a declaration of purpose as follows:

            "It is hereby declared to be in the public interest to foster, encourage, and promote the development, production, and utilization of oil and gas in the state in such manner as will prevent waste; to authorize and to provide for the operation and development of oil and gas properties in such manner as to assure that the maximum economic recovery of oil and gas may be obtained and the rights of owners thereof fully protected; and to encourage, authorize, and provide for cycling, recycling, pressure maintenance and secondary recovery operations in order that the maximum economic recovery of oil and gas may be obtained to the end that land owners, royalty owners, producers, and the general public may realize and enjoy the greatest possible benefits from these vital resources."

            It is a general rule of statutory construction that a statute will be construed as having a prospective operation only unless it plainly indicates an intent that it shall operate retrospectively.  SeeHeilig v. City Council of Puyallup, 7 Wash. 29; In re Ziegner's Estate, 146 Wash. 537; In re Wind's Estate, 32 Wn. (2d) 64.  Or, stating the proposition conversely, retroactive statutes are generally regarded with disfavor and, where it does not clearly appear that such was the legislative intent, the courts will not give a statute a retroactive effect where to do so would impair existing rights.  SeeHorner v. Pierce County, 111 Wash. 386; andIn re Fotheringham's Estate, 183 Wash. 579.

             [[Orig. Op. Page 3]]

            An examination of the provisions of RCW chapter 78.52 fails to disclose any language indicating the intention of the legislature that the act was to be applied retroactively.  On the contrary, the various sections of the act clearly show an intent that the act is to take effect in the future.  For example, RCW 78.52.120 provides that "any person desiring or proposing to drill any well in search of oil or gas, before commencing the drilling . . . shall notify the committee . . . and shall pay to the state treasurer a fee of one hundred dollars for each such permit."  In addition, RCW 78.52.040 defines the duties and powers of the committee to administer and enforce the provisions of the act and the rules and regulations to be promulgated thereunder.

            It is clear that those provisions of the act relating to the drilling of new wells, the issuance of rules and regulations and the establishment of well spacing areas, could be enforced by the committee only after the effective date of the act.  However, there are certain provisions in the law which clearly authorize the committee to obtain information concerning wells and oil leases in existence prior to 1951, etc., and to do certain things with reference to all gas and oil wells, including those drilled prior to the effective date of the act.

            For example, § 18 (RCW 78.52.160) specifically provides as follows:

            "The committee has authority to require:

            "(1) Identification of ownership of oil or gas wells, producing leases, tanks, plants, structures, and facilities for the transportation or refining of oil or gas;

            ". . .

            "(3) The drilling, casing, operating, and plugging of wells in such manner as to prevent the escape of oil or gas out of one pool into another, the intrusion of water into an oil or gas pool, the pollution of fresh water supplied by oil, gas, or salt water, and to prevent blow-outs, cavings, seepages, and fires;

            "(4) The furnishing of a reasonable bond with good and sufficient surety, conditioned on the performance of the duty to plug each dry or abandoned well;

            ". . .

             [[Orig. Op. Page 4]]

            "(7) Compliance with each and all of the applicable statutes of this state and the rules and regulations of the supervisor of forestry for the prevention of unreasonable loss or damage to timber."

            In addition, § 19 (RCW 78.52.170) gives the committee further authority to regulate the "plugging of wells."  We think it was clearly the intention of the legislature that the committee have authority to regulate wells already in existence in so far as necessary to prevent such occurrences as the escape of gas or oil, the pollution of fresh water, loss or damage to timber, and the elimination of the hazards of dry or abandoned wells which had not been plugged.  Accordingly, you are advised, in answer to your first question, that although the committee may not apply the provisions of the gas and oil conservation act of 1951 retroactively, it is authorized to apply the pertinent provisions outlined above to wells which were already in existence in 1951.

            In answer to your second question, the rules and regulations promulgated under the act provide that "these rules and regulations shall become effective this 18th day of January, 1954."  Clearly, the specific requirements contained in the rules and regulations under the authority cited above cannot be applied retroactively.

            It is also clear, however, that the rules and regulations which have to do with the plugging of dry wells, the identification of wells, and the right of access of the committee to all wells and well records can be made to apply to wells which were already in existence on January 18, 1954.  We direct your attention specifically to Rules 10, 11, 22, 23, 24, 25 and 26 which are applicable in the above situation.

            In answer to your third question concerning whether or not the plugging requirements contained in the rules and regulations can be made to apply to a well which has not been abandoned but on which no work has been done since 1953, a factual determination must be made by the committee whether or not the well is in effect either a dry or abandoned well under the terminology used in the act and the rules and regulations.

            We trust this information will be of assistance to you.

Yours very truly,

JOHN J. O'CONNELL
Attorney General

JANE DOWDLE SMITH
Assistant Attorney General