(A) The operator shall provide or cause to be provided the insurance described below for each well for which a gas well permit is issued. Such insurance must continue until the well is abandoned and the site restored. The operator may provide the required coverage on a "blanket" basis for multiple wells if the site of each well is sufficiently identified, the limits of coverage are sufficient as determined by the city within its sole discretion, and the blanket policy is otherwise approved by the city. The operator must provide to the city sufficient documentation that the operator's insurance complies with the requirements of this section before the issuance of the gas well permit.
(B) General requirements - indemnification and express negligence provisions.
(1) Each gas well permit issued by the city shall include the following language and regardless of whether such language is actually included in the gas well permit it shall be deemed to be included therein:
OPERATOR DOES HEREBY EXPRESSLY AND IRREVOCABLY RELEASE AND DISCHARGE ALL CLAIMS, DEMANDS, ACTIONS, JUDGMENTS, AND EXECUTIONS OF ANY AND ALL KINDS WHICH IT OR ITS SUCCESSORS OR ASSIGNS EVER HAD, OR NOW HAS OR MAY HAVE, OR CLAIMS TO HAVE, AGAINST THE CITY OF MANSFIELD, TEXAS, ITS DEPARTMENTS, AGENTS, OFFICERS, SERVANTS, EMPLOYEES, SPONSORS, OR VOLUNTEERS, THE GAS WELL INSPECTOR, AND EACH OF THEIR RESPECTIVE HEIRS, PERSONAL REPRESENTATIVES, SUCCESSORS, AND ASSIGNS (THE CITY OF MANSFIELD, TEXAS AND ALL OTHER FOREGOING PARTIES BEING HEREIN REFERRED TO COLLECTIVELY AS THE "INDEMNIFIED PARTIES") CREATED BY OR ARISING OUT OF PERSONAL INJURIES, KNOWN OR UNKNOWN, OR INJURIES TO PROPERTY, REAL OR PERSONAL, OR IN ANY WAY INCIDENTAL TO OR IN CONNECTION WITH THE PERFORMANCE OF THE WORK PERFORMED BY THE OPERATOR UNDER A GAS WELL PERMIT. OPERATOR AGREES TO FULLY DEFEND, PROTECT, INDEMNIFY, AND HOLD HARMLESS THE INDEMNIFIED PARTIES FROM AND AGAINST EACH AND EVERY CLAIM, DEMAND, OR CAUSE OF ACTION AND ANY AND ALL LIABILITY, DAMAGES, OBLIGATIONS, JUDGMENTS, LOSSES, FINES, PENALTIES, COSTS, FEES, AND EXPENSES INCURRED BY THE INDEMNIFIED PARTIES CAUSED BY OR ARISING OUT OF, INCIDENTAL TO, OR OTHERWISE IN CONNECTION WITH ANY WORK PERFORMED BY OPERATOR UNDER A GAS WELL PERMIT OR ARISING OUT OF THE USE OF THE DRILL SITE, PIPELINE OR ANY OTHER ASSOCIATED APPURTENANCES THERETO, INCLUDING, WITHOUT LIMITATION, PERSONAL INJURIES AND DEATH IN CONNECTION THEREWITH WHICH MAY BE MADE OR ASSERTED BY OPERATOR, HIS AGENTS, ASSIGNS, OR ANY THIRD PARTIES. OPERATOR AGREES TO FULLY DEFEND, PROTECT, INDEMNIFY, AND HOLD HARMLESS THE INDEMNIFIED PARTIES FROM ANY CLAIMS, LIABILITIES, OR DAMAGES SUFFERED AS A RESULT OF CLAIMS, DEMANDS, COSTS, OR JUDGMENTS AGAINST THE INDEMNIFIED PARTIES, CREATED BY OR ARISING OUT OF THE ACTS OR OMISSIONS OF THE CITY OF MANSFIELD OR ANY OF THE OTHER INDEMNIFIED PARTIES, OCCURRING ON THE DRILL SITE OR OPERATION SITE IN THE COURSE AND SCOPE OF INSPECTING AND PERMITTING THE GAS WELLS INCLUDING, BUT NOT LIMITED TO, CLAIMS, LIABILITIES, AND DAMAGES ARISING IN WHOLE OR IN PART FROM THE NEGLIGENCE OF ANY OF THE INDEMNIFIED PARTIES, INCLUDING THE SOLE NEGLIGENCE OF ANY INDEMNIFIED PARTY, OCCURRING ON THE DRILL SITE OR OPERATION SITE IN THE COURSE AND SCOPE OF INSPECTING AND PERMITTING THE GAS WELLS. IT IS UNDERSTOOD AND AGREED THAT THE INDEMNITY PROVIDED FOR IN THIS SECTION IS AN INDEMNITY EXTENDED BY THE OPERATOR TO INDEMNIFY AND PROTECT THE CITY OF MANSFIELD, TEXAS AND THE OTHER INDEMNIFIED PARTIES FROM THE CONSEQUENCES OF THE NEGLIGENCE OF ANY OF THE INDEMNIFIED PARTIES, WHETHER THAT NEGLIGENCE IS THE SOLE OR CONTRIBUTING CAUSE OF THE RESULTANT INJURY, DEATH AND/OR DAMAGE. THE FOREGOING IS NOT INTENDED TO REQUIRE THE OPERATOR TO INDEMNIFY THE INDEMNIFIED PARTIES FROM THE INDEMNIFIED PARTIES' GROSS NEGLIGENCE OR INTENTIONAL HARM, IRRESPECTIVE OF WHETHER THAT GROSS NEGLIGENCE OR INTENTIONAL HARM IS THE SOLE OR CONTRIBUTING CAUSE OF THE RESULTANT INJURY, DEATH, AND/OR DAMAGE.
(2) All policies shall be endorsed to read: “This policy will not be cancelled or non-renewed without 30 days’ advanced written notice to the owner and the City of Mansfield, Texas, except when this policy is being cancelled for nonpayment of premium, in which case ten days' advance written notice is required."
(3) Liability policies shall be written by:
(a) Carriers licensed to do business in Texas and with companies with A: VIII or better rating in accordance with the current Best Key Rating Guide; or
(b) Non-admitted carriers that have a financial rating comparable to carriers licensed to do business in Texas and which are approved by the city.
(4) Liability policies shall name as "additional insured" the city and other indemnified parties. Waivers of subrogation shall be provided in favor of all indemnified parties.
(5) Copies of the pertinent portion of the insurance policies evidencing all coverages and endorsements required by this section must be presented to the city before the issuance of the gas well permit, and the acceptance of a policy without the required limits and/or coverages shall not be deemed a waiver of these requirements. The city may, in its sole discretion, accept a certificate of insurance in lieu of a copy of the pertinent portion of the policy pending receipt of such document by the city. After the issuance of the gas well permit, the city may require the operator to provide a copy of the most current insurance coverages and endorsements for review at any time. An administration fee shall be assessed to cover the cost of the review, in the amount set forth in the development fee schedule.
(6) Claims-made policies shall not be accepted except for excess policies and environmental impairment (or seepage and pollution) policies.
(C) Required insurance coverage.
(1) Commercial or comprehensive general liability insurance.
(a) Coverage should be a minimum combined single limit of $1,000,000 per occurrence for bodily injury and property damage, with a $2,000,000 annual general aggregate. This coverage must include premises, operations, blowout or explosion, products, completed operations, blanket contractual liability, underground property damage, underground reservoir (or resources) damage, broad form property damage, independent contractors protective liability and personal injury.
(b) Underground reservoir (or resources) damage shall be on an occurrence basis, shall not be limited to sudden and accidental occurrences, shall not have a discovery or reporting limitation and shall not exclude damage to water tables, formation or strata.
(c) Environmental impairment (or seepage and pollution) shall be either included in the coverage or written as separate coverage. Such coverage shall not exclude damage to the lease site. If environmental impairment (or seepage and pollution) coverage is written on a "claims made" basis, the policy must provide that any retroactive date applicable precedes the effective date of the issuance of the permit. Coverage shall apply to sudden and accidental pollution conditions resulting from the escape or release of smoke, vapors, fumes, acids, alkalis, toxic chemicals, liquids, gases, waste material, or other irritants, contaminants or pollutants. Coverage shall be a minimum combined single limit of $1,000,000 per occurrence. A discovery period for such peril shall not be less than 30 days after the occurrence.
(2) Automobile liability insurance. Minimum combined single limit of $1,000,000 per occurrence for bodily injury and property damage. Such coverage shall include owned, non-owned, and hired vehicles.
(3) Workers' compensation insurance. In addition to the minimum statutory requirements, coverage shall include employers’ liability limits of at least $1,000,000 for each accident. $1,000,000 for each employee, and a $1,000,000 policy limit for occupational disease, and the insurer agrees to waive rights of subrogation against any of the indemnified parties for any work performed for the city by the operator.
(4) Excess (or umbrella) liability insurance. Minimum limit of $10,000,000 covering in excess of the preceding liability insurance policies.
(5) Control of well insurance.
(a) Minimum limit of $10,000,000 per occurrence, with a maximum deductible of $250,000 per occurrence.
(b) Policy shall cover the cost of controlling a well that is out of control, re-drilling or restoration expenses, and seepage and pollution damage. Damage to property in the operator's care, custody, and control with a sub-limit of $500,000 may be added.
(Ord. OR-1942-15, passed 3-23-15) Penalty, see § 114.99