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Texas Oil and Gas Blanket Bond (P5 Bond)

If you own or operate a oil and gas business in Texas, you've likely heard about oil and gas blanket bonds or P5 bonds. On this page, we'll look at some of the basics behind this type of bond so that your business can be well equipped to succeed. Read on to find out what these types of surety bonds are and why your oil and gas business in Texas may need them.

What is a Texas Oil and Gas Blanket, or P5 Bond?

The P-5 bond is a license/permit surety bond required by the Railroad Commission of Texas. P-5 bonds are required to ensure different aspects of operating and abandoning oil or gas wells are managed and/or completed in accordance to Texas laws and regulations.

Some of the Oil and Gas well activities scrutinized for compliance with applicable laws and regulations are as follows:

  • Proper well operation and maintenance in order to prevent leakage and/or pollution of ground and surface water.
  • Inactive well maintenance to prevent leakage and pollution.
  • Proper well plugging and abandonment.
  • Surface restoration.
  • Proper clean up of pollution associated with the oil and gas operation.

Texas Oil and Gas Blanket Bond Requirements

There are several bond amounts associated with the P-5 bond. There are blanket bond amounts of $25,000, $50,000 and $250,000. There is also a calculation available to organizations that solely operate oil and gas wells, $2 for every foot of total well depth.

Why Are These Bonds Required?

These types of bonds are required to ensure that oil and gas operations in Texas follow all of the state rules and regulations that apply to them. This is why oil and gas blanket bonds are an important part of the permitting process. In the event that a company does not abide by the regulations set forth by the state, this surety bond provides a path for recourse and protects the state from financial loss. This encourages responsibility in the drilling world, so that the state of Texas can ensure that businesses operate in the best interests of all Texans.

Your Source for Texas Oil and Gas Blanket Bonds

Oil and gas bonds can be difficult to place. Viking has markets that work with these types of bonds. We can typically obtain a P-5 bond quote the same day or within 24 hours of receiving the surety bond application and any required documentation.

Viking Bond Service, Inc., is committed to providing oil and gas companies in Texas with the surety bond solutions they need to operate a successful business. Our surety bond experts are at-the-ready to assist you every step of the way, from initial consultation to long-term partnerships. We have over thirty years of experience providing superior surety bonds to businesses around the country. To get started, give us a call at 1-888-278-7389 or complete an online application today.

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