Alabama Underground Storage Facility Bond

Alabama Underground Storage Facility Bond

The $100,000 surety bond for Alabama Underground Storage Facilities for a Solution-mined Cavity and Storage Well, also known as the Underground Storage Facility Bond, is required by the State Oil and Gas Board of Alabama for storage operators commencing work on underground gas storage facilities.

APPLY FOR BOND

The bond provides reassurance to the Board that compensation will be available if a storage operator fails to act in accordance with the state rules, regulations, and laws.

How is the Price Determined for the Alabama Underground Storage Facility Bond?

The price you pay for the bond will only be a small percentage of the $100,000 bond limit. There are multi-year options, which allow you to save some money in the long run by paying a larger sum up front. Other factors will be considered, including a review of financials and personal credit.

The State Oil and Gas Board may, for good cause, and after notice and hearing, require an increased bond amount due to environmentally sensitive site conditions, or other valid reasons.

Why Is the Underground Storage Facility Bond Required in Alabama?

The State Oil and Gas Board of Alabama is charged with protecting the environment, and owners’ rights, by creating and enforcing regulations that encourage oil and gas conservation and prevent waste. Storage facility operators, specifically, are regulated by the Board and are required to get a surety bond to work on underground storage facilities for solution-mined cavities and storage wells.

The bond is a tool used by the Board to ensure funds are available should the storage operator not comply with Alabama Administrative Code Chapter 400-6. For example, the bond may be used to clean up and restore the site if the facility operator fails or refuses to properly plug a well and abandon a cavity pursuant to Chapter 400-6-10.

How to Apply for the Underground Storage Facility Bond With Jet

After you submit the basic information in our online application, one of Jet’s underwriters will reach out shortly afterwards with the next steps. We may require financial statements or bank statements.

The underwriter will look over the details and work to get you an approved rate shortly, which will be sent to your email. From there, you are able to purchase the bond and receive a copy of the bond and your receipt.

How Does the Underground Storage Facility Bond Get Filed to the State Oil and Gas Board of Alabama?

A completed Form OGB-3D bond form includes signatures from the surety company (Jet) and the storage operator. It also needs to have a surety seal, and a corporation seal from the operator if applicable. All partners must sign the bond.

We fill out our part of the bond and send it to you to complete and get to the Board. The Oil and Gas Well Bond and any other paperwork must be sent to the address below:

State Oil and Gas Board of Alabama 
PO Box 869999
Tuscaloosa, AL 35486

If the bond needs to be overnighted, it should be sent here:

State Oil and Gas Board of Alabama
420 Hackberry Lane
Tuscaloosa, Alabama 35401

Can I Cancel My Underground Storage Facility Bond

No; the Board does not allow for cancellation of the bond. It must be in place for the duration you are operating the well or wells.

How to Renew the Alabama Underground Storage Facility Bond

When renewal is approaching, Jet sends an invoice via email and mail. Either fill out the mailed invoice and return it or go through the email to pay online. You must make payment prior to the bond’s expiration date to avoid complications.

How Does a Storage Operator Avoid Bond Claims?

A storage facility operator fulfilling duties according to the rules, regulations, and laws in the Alabama Administrative Code, Chapter 400-6, and Code of Alabama 1975, Title 9, Chapter 17, Article 6 can avoid bond claims.

Form OGB-3D specifies general duties of storage operators as follows:

Should any issues arise, the Alabama State Oil and Gas Board will schedule a hearing to decide how to proceed. Working with the board is your best bet to avoid a claim payout for which you’ll be responsible to pay back.

What Happens if I Get an Underground Storage Facility Bond Claim?

Any claim that comes to Jet has already had a ruling handed down by the State Oil and Gas Board of Alabama. However, Jet will review all the claim details and may ask you for additional documentation prior to paying the claim. If the claim is valid, Jet will make payment to the Board and you will be responsible to reimburse Jet since you are responsible for your actions.

Alabama Underground Storage Facility Bond Form

Notary Bond Application:

X

Business Information:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Employee Dishonesty Bond Application:

Business Information:

Business Description:

Coverage Requirements:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Contract Bond Application:

X

Business Information:

Owner Information:

Job Details:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Worker's Compensation Application:

X

Business Information:

Business Description:

Coverage Requirements

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information: