In the event a permit shall be issued by the oil and gas inspector, no actual operations shall be commenced until the permittee shall file with the city bonds or irrevocable letters of credit and certificates of insurance as follows:
A. A bond or irrevocable letter of credit in the principal sum of at least twenty five thousand dollars ($25,000.00). Said bond shall be executed by a reliable insurance company authorized to do business in the state, as surety, and with the applicant as principal, running to the city for the benefit of the city and all persons concerned, conditioned that the permittee shall comply with the terms and conditions of this chapter in the operation of the well for either natural or artificial production, injection or disposal. Said irrevocable letter of credit shall be issued by a bank authorized to do business in the state, as surety, and the applicant as principal, running to the city for the benefit of the city and all persons concerned, conditioned that the permittee shall comply with the terms and conditions of this chapter in the operation of the well for either natural or artificial production, injection or disposal. Said bond or irrevocable letter of credit shall become effective on or before the date the same is filed with the city and remain in force and effect for at least twelve (12) months subsequent to the expiration of the permit term, and in addition the bond or irrevocable letter of credit will be conditioned that the permittee shall promptly pay fines, penalties and other assessments imposed upon the permittee by reason of his breach of any of the terms, provisions and conditions of this chapter, and that the permittee will promptly restore the streets, sidewalks and other public property of the city which may be disturbed or damaged in permittee's operations, to their former condition; and that the permittee will promptly clear all premises of all litter, trash, waste, and other substances, and will, after abandonment, grade, level and restore said property to the same surface condition, as practicable as possible, as existed prior to commencing operation and further that the permittee shall indemnify and hold harmless the city from any and all liability attributable to granting the permit; and that the applicant/permittee shall promptly pay all sums with respect to deductibles on covered losses under insurance policies required by this chapter.
B. In addition to the bond or irrevocable letter of credit required in subsection A of this section, the permittee shall obtain a pollution insurance policy which meets the following requirements:
1. Said insurance policy shall be a standard pollution liability insurance policy to include coverage for contamination or pollution of surface or subterranean streams, watercourses, lakes or public or private water supplies providing for a minimum coverage of one million dollars ($1,000,000.00).
2. Said insurance policy shall be issued by a reliable insurance company licensed to do business in this state, with the applicant/permittee and the city named as coinsureds.
3. Said insurance policy shall be maintained in full force and effect from commencement of drilling operations until the well is plugged and abandoned in accordance with this chapter, including the entire period during which production activities are conducted. The legal description of the well location and the city permit number, if any, shall be specified in the insurance policy, or any endorsement thereto, with respect to each well covered by such insurance.
4. All insurance policy or policies shall provide that they may not be canceled without written notice of the oil and gas inspector at least thirty (30) days prior to the effective date of such cancellation. In the event said policy or policies are canceled, the permit granted shall immediately terminate without any action on the part of the oil and gas inspector, and the applicant/permittee's rights to operate under said permit shall cease until the applicant/permittee files additional insurance as required herein.
5. The deductible for any pollution insurance policy shall not exceed twenty five thousand dollars ($25,000.00).
C. In addition to the bond or irrevocable letter of credit and insurance required in subsections A and B of this section, the permittee shall carry a policy or policies of standard comprehensive public liability insurance, including contractual liability covering bodily injuries and property damage, naming the permittee and the city as coinsureds, issued by an insurer authorized to do business within the state, said policy or policies in the aggregate shall provide for the following minimum coverage:
1. Bodily injuries, one hundred thousand dollars ($100,000.00) per person, three hundred thousand dollars ($300,000.00) per accident;
2. Property damage, two hundred thousand dollars ($200,000.00);
3. One million dollars ($1,000,000.00) for any number of claims arising out of a single occurrence or accident.
Permittee shall file with the city certificates of said insurance as above stated, and shall obtain the written approval thereof of the oil and gas inspector who shall act thereon promptly after the date of such filing.
Said insurance policy or policies shall not be canceled without written notice to the oil and gas inspector at least ten (10) days prior to the effective date of such cancellation. In the event said policy or policies are canceled, the permit granted shall immediately thereupon terminate without any action on the part of the oil and gas inspector, and the permittee's rights to operation under said permit shall cease until permittee files additional insurance as provided herein. (Ord. 807 §1, 1996: Ord. 709 §1, 1991: Ord. 528 §1, 1982)