Fillmore Municipal Code Ch. 7.28 Oil Drilling

It is declared to be the object and purpose of this chapter to establish reasonable and uniform limitations, safeguards and controls for the future drilling for and production of oil, gas and other hydrocarbon substances within the city. Limitations, safeguards and controls are deemed necessary in the public interest in order to effect practices which will provide a community plan for the orderly development and conservation of such mineral resources so important to the economy, and which will also protect the surface uses of the land, the value and character of improvements in or near districts where oil drilling or production is hereinafter permitted, and the desirability of certain areas for residential, commercial or other uses. It is contemplated that areas within the city may be explored for oil by directional drilling methods, with surface drilling and production operations limited to a minimum of controlled drilling sites, so located, spaced and regulated as to cause the least possible detriment to the community and to the general welfare.

(Ord. 269 § 1, 1957)

(a) "Applicant" or "permittee" means said person or persons, his or their successors in interest, and any parent company or subsidiary thereof.

(b) "City manager" means the duly appointed, qualified and acting administrative head of the city government.

(c) "Controlled drilling site" means the location upon which surface operations incident to oil well drilling deepening and the production of oil or gas or other hydrocarbon substances may be permitted under the terms of Section 7.28.010 et seq., subject to conditions prescribed by the council.

(d) "Directional drilling" means whipstocking, or slant drilling from a controlled drilling site.

(e) "Oil" includes oil, gas or other hydrocarbon substances.

(f) "Oil well" means any well or hole already drilled, being drilled or to be drilled into the surface of the earth which is used or intended to be used in connection with coring, or the drilling for, prospecting for, or producing petroleum, natural gas, or other hydrocarbon substances; or is used or intended to be used for the subsurface injection into the earth of oil field waste, gases, water or liquid substances; including any such existing hole, well, or casing which has not been abandoned in accordance with the requirements of this chapter.

(Ord. 269 § 2, 1957)

Future drilling for oil, gas or other hydrocarbon substances within the city shall be conducted only in accordance with the provisions of Section 7.28.010 et seq., and any drilling operation not in conformity therewith is a public nuisance and shall be prohibited.

(Ord. 269 § 3, 1957)

Whenever the public necessity, convenience or general welfare justify such action, the council may establish by ordinance or resolution an oil drilling district.

(Ord. 269 § 4, 1957)

The proceedings for the establishment of an oil drilling district may be initiated by a verified application of one or more of the owners or lessees of property within the boundaries of the proposed district, or by resolution of the planning commission or council. An application for the establishment of a district shall be filed with the city council upon a form and accompanied by such data and information as may be prescribed for that purpose by the city council so as to assure the fullest practicable presentation of facts for the permanent record, and shall be accompanied by a filing fee of two hundred dollars which shall not be refundable. In the application, the applicant shall agree that he shall be bound by the provisions of Section 7.28.010 et seq. and all provisions of any drilling district ordinance or resolution and drilling permit adopted or granted as a result of the application. Each application shall contain a statement that the applicant has the proprietary or contractual authority to drill for and produce oil, gas, or other hydrocarbon substances under the surface of at least fifteen percent of the property to be included in the district. The district described in the application shall be not less than forty acres, but not more than one hundred acres in area, including all streets and alleys within the boundaries thereof. Districts shall include all property within their boundaries and shall be compact in area. The boundaries thereof shall so far as practicable follow property lines, public streets or alleys and the boundaries of previously created districts, thereby avoiding leaving areas between districts which cannot be later formed into districts of the minimum size. Land under such authority of the applicant and located outside the boundaries of the city and contiguous with the proposed district may be included for the purpose of calculating said minimum areas. Smaller districts may be created in situations where there is no contiguous property within the city which could be included to create a district of minimum size. Each application shall contain a description of the controlled drilling site, from which the applicant has or can secure access to the proposed district and which he proposes to use to develop the proposed district. Six copies of a map and legal description of each proposed district or districts and the controlled drilling site proposed to be used in developing said district or districts shall accompany the application. Such map shall be available in the office of the city clerk for examination by interested property owners.

(Ord. 269 § 4.11, 1957)

Upon the filing of such application or the adoption of such resolution by the commission or the council, the matter of establishing such district shall be referred to the commission for report and recommendation only, and shall be set for public hearing before the planning commission. Notice of the time, place and purpose of such hearing shall be given by the following method:

(1) By at least one publication in a newspaper of general circulation in the city not less than ten days prior to the date of the hearing; and

(2) By mailing a postal card or letter notice not less than five days prior to the date of such hearing, to the owners of all property within the proposed district and within three hundred feet of the exterior boundaries of the property proposed to be included within the district, using for this purpose the last known name and address of such owners as shown upon the record of the county assessor.

The affidavit of the secretary of the planning commission affirming that such notice was mailed as prescribed above shall be prima facie evidence of the mailing of the notice. Proof of failure to mail notice to a particular owner shall not invalidate, as to other property owners, any district created under this section.

(Ord. 269 § 4.12, 1957)

The planning commission shall consider the proposal to establish the district, and may approve, conditionally approve, or disapprove the same, either in whole or in part. If the application is approved the commission shall transmit the application, together with its report and recommendations relative thereto, to the council, and the council, may by ordinance or by resolution establish such district. The planning commission or the council may enlarge the proposed boundaries of a district, providing that notice is given to owners within the enlarged areas and a public hearing is held thereon, as set forth in Section 7.28.060. The planning commission shall act on any application for the establishment of a district within thirty days from the date the public hearing is terminated. This time limit may be extended, by mutual consent of the applicant and the planning commission, for an additional period. In the event the planning commission fails to act within the specified time limit, the planning commission shall be deemed to have approved the establishment of the district as requested in the application, and the secretary of the commission shall advise the council accordingly.

(Ord. 269 § 4.13, 1957)

If the establishing of a proposed district is disapproved by the planning commission, any applicant, owner or lessee of mineral rights included in such proposed district may appeal to the council. Such appeal shall be filed in duplicate with the city clerk within twenty days from the date of mailing the notifications of disapproval to the applicant, or within twenty days from the action of the planning commission disapproving a proposal initiated by the planning commission or council. An appeal shall set forth specifically wherein it is alleged that the planning commission's findings and recommendations were in error. The city clerk shall transmit one copy of the appeal to the planning commission and thereupon the planning commission shall transmit the file with a report to the council disclosing in what respect it failed to find that the public necessity, convenience, general welfare, or good zoning practice requires the establishment of such district. The council shall then review the action of the planning commission and in its discretion may enact an ordinance or adopt a resolution establishing the district and designating the controlled drilling site or sites from which the district is to be developed.

(Ord. 269 § 4.14, 1957)

All oil drilling districts shall be subject to the following conditions:

(1) Controlled Drilling Site. Not more than four controlled drilling sites shall be permitted for each district, and each such site shall not be larger than two acres, provided, however, that where such site or sites are to be used for the development of the maximum size oil drilling districts or where the planning commission and/or the city council require that more than one oil drilling district be developed from one or more controlled drilling sites, such sites may be enlarged, at the discretion of the council;

(2) Number of Wells. The number of oil wells which may be drilled in an oil drilling district may not exceed one well to each ten acres for each such district;

(3) Offer to Lease. Each applicant or his successor in interest shall within ninety days from the date of the ordinance or resolution establishing the particular district becomes effective - (A) File a declaration of pooling, pooling all property within the district which is then under lease to the applicant and which may be pooled under the terms of the particular lease, and (B) Execute an offer in writing giving to each record owner of the oil, gas and mineral rights located in the oil drilling district who has not joined in the lease, or other authorization to drill, the right to join in the lease or authorization and thereafter to share in rental payments, bonus payments and the proceeds of production from wells bottomed in said district. The share shall be computed upon the same basis, as that of the average of the owners of oil, gas and mineral rights (by surface area) who have by lease or other legal consent, agreed to the drilling for and production of oil, gas or other hydrocarbon substances by the applicant from the subsurface of the district at the time the district was created. The offer shall provide that the lessee shall have no right in the surface of the land, nor in the subsurface thereof except below a depth of five hundred feet. The applicant shall file the offer with the city clerk and cause it to be recorded in the office of the Ventura County Recorder. The offer required must remain open for acceptance for a period of five years after the date the drilling district is established. During the period the offer is in effect, the applicant, or his successors in interest, shall impound all proceeds of production to which the owners or any of them may become entitled, in a bank or trust company in the state of California, with proper provisions for payment to the said record owners of oil, gas and mineral rights in the district who had not signed the lease or other authorization at the time such drilling district was created, but who accept such offer in writing or who are deemed included pursuant to the provisions of Public Resources Code, Section 3608, within the five-year period. Any such payments remaining in any bank or trust company at the time the offer expires, which are not due or payable as hereinabove provided, and future payments as they would otherwise become due to said owners who have not joined in the lease or other drilling authorization, shall be paid to the city fund for acquisition and operations of parks and recreational facilities in order that those otherwise entitled shall receive through municipal improvements some benefit from the proceeds of such production;

(4) Quitclaim of a Portion of a District. If the grantee should quitclaim or otherwise release any portion of a district, the quitclaimed or released lands shall continue to share pro-rata in the proceeds of production from any wells bottomed in the district, provided, however, that this provision shall not be deemed to abrogate or supersede any contractual relationship entered into by the particular owner, and provided further that such quitclaimed land shall cease to share at such time as such quitclaimed land is again leased or drilled upon;

(5) Termination of Drilling Districts. At any time after one year from formation of a district, upon request of any owner or lessee of mineral rights within the district, or at any time upon initiation of reviewing action by the council, any district may be reviewed and the council may by ordinance or by resolution dissolve or reduce the size, or partition the district as follows: Prior to the production of oil within a district, the district may be dissolved if it does not appear that drilling operations are being diligently prosecuted or if the applicant for such district, or his successor in interest, does not hold proprietary or contractual authority to drill for and produce oil under the surface of at least fifty-one percent of the property within the district, providing the action is reasonable under the particular circumstances. After the production of oil within a district and subsequent to quitclaiming of portions of a district, the district may be reduced in size by elimination of quitclaimed and nonleased or noncontrolled acreage.

(Ord. 269 § 5, 1957)

No future oil or gas well shall be commenced to be drilled in the city except under the authority of a city drilling permit for the particular well. Any party who holds the proprietary or contractual authority to drill for and produce oil, gas or other hydrocarbon substances beneath the surface of at least fifty-one percent of the property included in any approved drilling district may apply to the city council for a drilling permit on an approved controlled drilling site as set forth above, which permit shall be issued subject to the following conditions:

(1) Each drilling permit shall be issued for one well only, and a separate drilling permit shall be required for each additional well;

(2) Each application for a drilling permit shall be accompanied by a filing fee of one hundred dollars, which said fee shall not be refundable;

(3) As a condition of continuing such permit in force and effect, an annual permit renewal and inspection fee of fifty dollars shall be paid by the permittee on the first day of January following the issuance of such permit, and on the first day of January in each year thereafter;

(4) No surface drilling or production equipment or appurtenances accessory thereto within the district shall be located outside the drilling site;

(5) Upon any well being placed on production, the permittee shall file with the city clerk a city lot map verified by the permittee or a responsible official thereof, showing the location of the production interval and route of the well between said interval and the controlled drilling site. All wells passing through or bottomed under the residential or commercial areas except on a drilling site shall be below a depth of five hundred feet;

(6) All operations within the city shall be conducted in accordance with good and safe town lot oil drilling and production practices and in accordance with applicable government regulations;

(7) A city building permit shall be secured for any permanent or temporary structure to be used in connection with the production of oil and constructed on the controlled drilling site, which structure shall conform to the city building code. A drilling permit shall not be construed to authorize any use requiring a special use permit under any ordinance or resolution other than drilling for and production only of oil. Refineries, dehydration plants, absorption plants, tank farms and other uses not necessary to the production, cleaning and shipping of oil at the well head shall not be considered authorized by the drilling permit;

(8) The controlled drilling site shall be adequately landscaped, except for those portions occupied by any required structure, appurtenance or driveway, and all such landscaping shall be first submitted to and approved by the city council. Except for the derrick and gauging and shipping tanks above eight feet all machinery, tools, pipe and other equipment used in connection with any drilling or production operations shall be screened from view, and all drilling operations shall be conducted or carried on behind a substantial fence, which shall be as unobtrusive as practicable and shall be maintained in good condition at all times;

(9) No oil, gas, or other hydrocarbon substances may be produced from any well hereby permitted unless all equipment necessarily incident to such production is screened from view;

(10) Unless authorized by a special use permit as set forth above, there shall be no tanks or other facilities for the storage of oil erected or maintained on the premises, except closed gauging and shipping tanks. Upon completion of the drilling operation and said well being placed in production, all oil produced shall be transported from the well by means of an underground pipe line without venting products to the atmospheric pressure at the production site, except when venting is necessary in the interest of safety;

(11) No permanent installation shall extend more than twenty feet above the surface of the ground, and upon the completion of the drilling operation, if a producing well is secured, no machinery, equipment, devices, structures or other accessories to oil production shall be used, which extend more than twenty feet above the surface of the ground. In order to meet this requirement, excavations may be made for the submersion of portions of said equipment and machinery or other installation;

(12) No earthen sump shall be used, and all waste water, mud, oil or any other waste products from the drilling operations shall be accumulated in steel tanks. Such steel tanks may be placed in excavations for the purpose of providing gravity flow, but shall not be permitted to overflow at any time, and all such tanks which extend above the natural surface of the ground less than five feet shall be considered as debris basins and shall be entirely enclosed by a chain-link fence or equal at least six feet in height, erected in a substantial manner. Such tanks or the waste material therein shall be hauled away from the drilling site for the disposal at an approved waste disposal site. If such disposal is done by other than the permittee, the permittee shall inform the hauling or disposal contractor or agent of the requirements of this condition;

(13) Drilling operations shall be commenced within ninety days from the effective date of the permit or within such additional period as the council may, for good cause, allow and thereafter shall be prosecuted diligently to completion or else abandoned. If a producing well is not secured within one year, the well shall be abandoned. Upon application of the permittee, the City Council for good cause, may allow additional time for the completion of the well. Upon expiration of the drilling permit or the abandonment of any well or other facility, the premises shall be restored by the applicant to the conditions existing prior to the issuance of said permit, as nearly as practicable so to do;

(14) All operations under the permit shall conform in all respects to the regulations and requirements of the proper California State Regional Water Pollution Control Board No. 4 and other valid and applicable governmental regulations. The water supply of the city shall not be depleted, polluted or contaminated by any operations of the applicant or his successors in interest. All wells drilled shall be cased tight to bedrock, or other effective means used to prevent vertical movement of ground water, which other means shall be to the reasonable satisfaction of the city manager;

(15) All installations of whatever kind or nature and the maintenance thereof shall meet all reasonable requirements of the chief of the fire department. Permittee shall at all times use extreme caution to prevent the occurrence of fire, explosion and blow-out of wells. Permittee shall install and maintain in good condition the most modern and effective equipment available for the prevention, control and extinction of fire, explosion, and blow-out of wells;

(16) All drilling and production equipment used shall be so constructed and operated that no noise, vibration, dust, odor or other harmful or annoying substances or effect which reasonably can be eliminated or diminished by the use of greater care shall ever be permitted to result from drilling or production operations carried on at any drilling site or from anything incident thereto to the injury or annoyance of persons in the vicinity; nor shall the site or structures thereon be permitted to become dilapidated, unsightly or unsafe. Proven technological improvements in methods of drilling and production shall be adopted as they, from time to time, become available if capable of reducing factors of nuisance or annoyance;

(17) Any derrick used in connection with the drilling of well, and all machinery or equipment used to operate such derrick, shall be enclosed with fire-resistant and soundproofing material to the extent that the same may be accomplished without unduly interfering with the functioning thereof, unless this condition is waived by the city council;

(18) Within sixty days after the drilling of each well has been completed, and said well placed on production, the derrick, all boilers and all other drilling equipment shall be entirely removed from the premises unless such derrick and appurtenant equipment is to be used within a reasonable time limit determined by the city council for the drilling of another well on the premises;

(19) At all reasonable times, city officials shall be permitted to review and inspect the controlled drilling site and the method used in the drilling, production operations and disposal of waste;

(20) Upon issuance of a drilling permit and prior to drilling operations thereunder, the permittee shall provide and file with the city council a bond issued by a company authorized to do business in the state of California, conditioned upon the faithful performance of each and every condition set forth in the permit. The bond shall be maintained constantly until released by the city council. The amount of the bond shall be five thousand dollars for each well on a controlled drilling site, but not to exceed twenty-five thousand dollars for each drilling site. The surface of the roads to be used are to be examined prior to use in connection with the permit and an additional bond in the amount of twenty-five thousand dollars for each controlled drilling site, made payable to the governmental agency having jurisdiction, shall be posted guaranteeing the repair of all damage to roads by permittee. In the event other drilling permits are issued for the same controlled drilling site, said bonds may be amended to guarantee compliance with said other drilling permits. No extension of time that may be granted or any change of specifications or requirements that may be approved or required by any officer or department of this city or any other alterations, modifications or waiver affecting any of the obligations of the permittee made by any city authority or by any other power or authority whatsoever shall be deemed to exonerate either the permittee or the surety on any bond posted pursuant to this requirement;

(21) Written notice to the city manager of transfer of interest of the permittee is required within thirty days of such transfer. The transferee shall post the required bonds and agree in writing to comply with all provisions of this chapter and the drilling permit issued thereunder. If the notice, agreement and bonds are not filed within the thirty-day period, the drilling permit shall be automatically suspended until such time as said documents are filed;

(22) The drilling permit is limited to the duration of the ownership or lease of the subject property by the permittee or his successors, and shall expire when the permittee, or his successors, relinquish said ownership or lease or the right to develop the property or when the ownership or lease is otherwise terminated;

(23) The permittee shall hold the city and all officers and employees thereof harmless against any claims of third parties which may arise as a result of the permittee's operations within the city. Any permittee must at all times be insured to the extent of one hundred thousand dollars against liability in tort arising from drilling or production, or activities or operations incident thereto, conducted or carried on under or by virtue of the conditions prescribed in the drilling permit. A certificate of insurance issued pursuant hereto shall be subject to the approval of the city attorney, and duplicates shall be furnished to him. Each such policy shall be conditioned or endorsed to cover such agents, lessees or representatives of the permittee as may actually conduct drilling, production or incidental operations permitted by such drilling permit;

(24) Upon written application by any person affected thereby, the city council may, by resolution, waive any or all of the conditions or requirements of this section upon finding that the conditions or requirements so waived are not necessary in the particular instance for the protection of the public peace, health, safety or general welfare of the city or of its inhabitants.

(Ord. 269 § 6, 1957)

In addition to the above conditions applying to drilling permits, such additional conditions as are deemed necessary and proper to protect the public health, safety and welfare may be included in the drilling permit by the council. In its report to the council relative to establishment of a district, the planning commission may recommend certain additional conditions to be imposed. Some of these additional conditions are listed as follows and may be applied by reference hereto, but neither the council nor the planning commission shall be limited to such conditions:

(1) No wells shall be drilled within one hundred twenty-five feet of any public road, street or highway, and no permanent building or structures shall be erected within one hundred feet of the center line of any public road, street or highway;

(2) No materials, equipment, tools or pipe used for either drilling or production operations shall be delivered to or removed from the controlled drilling site except between the hours of six a.m. and eight p.m. on any one day, except in case of emergency incidental to unforeseen drilling or production operations;

(3) An internal combustion engine or electrical equipment may be used in the drilling or pumping operations of the well, and if an internal combustion engine is used, mufflers shall be installed on the mud pumps and engine so as to reduce noise to a minimum, all of the installations to be done in a manner satisfactory to the fire chief;

(4) Only electrical power shall be utilized for drilling, and other operations, which power shall not be generated on the controlled drilling site or in the district;

(5) An internal combustion engine or steamdriven equipment may be used in the drilling operations of the well, and if an internal combustion engine or steam-driven equipment is used, mufflers shall be installed on the mud pumps and engine. Exhaust from steam-driven machinery shall be expelled into a tank, so as to reduce noise to a minimum. All of the installations shall meet the reasonable requirements of the fire chief;

(6) Drilling operations shall be carried on or conducted in connection with only one well at a time at any controlled drilling site, and such well shall be brought in or abandoned before operations for the drilling of another well are commenced; provided, however, that the council may permit the drilling of more than one well at a time after the discovery well has been brought in;

(7) No oil, gas or other hydrocarbon substances may be produced from any controlled drilling site hereby permitted where said site is located within or in proximity to areas subdivided for residential purposes, unless all equipment on the site is countersunk below the natural surface of the ground or adequately screened from public view. Additionally, any new oil wells shall comply with the setback requirements prescribed in Section 7.28.115 of this chapter.

(8) No sign shall be constructed, erected, maintained or placed on the premises or any part thereof, except those required by law or ordinance or resolution to be displayed in connection with the drilling or maintenance of the well;

(9) Drilling and redrilling shall be conducted by the use of portable drilling equipment, utilizing masts, and no permanent derricks shall be installed.

(Ord. 269 § 7, 1957)

(Ord. No. 24-970, § 1, 5-28-2024)

(a) No new oil well, including equipment, tanks, or other facilities related to the creation of a new oil, shall be located within:

(1) One thousand five hundred feet from the nearest property line of a residential dwelling; or

(2) Two thousand five hundred feet from the nearest property line of any school.

(b) This Section applies only to new wells, which are drilled separate from any existing well.

(Ord. No. 24-970, § 2, 5-28-2024)

The violation of any condition prescribed by the council in the creation of an oil drilling district or of any drilling permit issued thereunder, which operation shall be conducted in connection with the drilling for production of oil, gas or other hydrocarbon substances shall constitute a violation of the provisions of this chapter, and shall subject such permit to cancellation or suspension by resolution of the city council. Recision or revocation of a drilling permit shall not be deemed a waiver by the city of the enforcement of any other legal right or action arising out of or connected with such violation.

(Ord. 269 § 8, 1957)