Oil and Gas
Evergreen Surety places bonds for upstream operators, pipeline contractors, oilfield service companies, and midstream processors – including well plugging and abandonment bonds, operator bonds, BLM federal lease bonds, statewide blanket bond programs, right-of-way bonds, FERC bonds, and construction performance and payment bonds across the United States. We are an independent surety bond agency with direct access to the carriers that underwrite these risks.
Oil and gas bond programs are not a side practice here. If you need a bond or your existing program needs a review, talk to a surety advisor today.
States and federal agencies are tightening bond requirements. If your program has not been reviewed against current operator tier thresholds, it may be underweight. For obligees requiring letter of credit format, a surety-backed letter of credit may be worth exploring.
We work with the full oil and gas operator stack
Our oil and gas clients include upstream E&P operators at every scale, oilfield services and drilling contractors, midstream pipeline companies and gathering system operators, processing and compression facility developers, downstream refinery contractors, and natural gas distribution companies. We also place bonds for CO2 and carbon capture operators as that sector develops.
The bond type, the obligee, and the underwriting considerations differ significantly across these segments. A plugging and abandonment bond for an upstream operator involves a different analysis than a pipeline right-of-way bond or an EPC performance bond for a gas processing facility. We know the differences and we place bonds across all of them.
Get your well and lease obligation bonds right
Well plugging and abandonment bonds are the most common bond requirement for upstream oil and gas operators. They guarantee that wells will be properly decommissioned at the end of their productive life – plugged, surface equipment removed, and the site restored. The regulatory framework varies by state and by land status, and getting the program structured correctly from the start avoids problems later.
State conservation commission bonds and federal BLM bonds are separate programs with separate obligees, separate forms, and separate adequacy standards. An operator with both state and federal obligations needs a program that satisfies both – and an agency that understands how the two interact.
Well plugging and abandonment bonds
State conservation commissions require operators to post well plugging and abandonment bonds as a condition of operating wells within their jurisdiction. Most states offer a statewide blanket bond option that covers all wells operated in the state under a single bond – which is more efficient than per-well bonds for operators with multiple wells. Some states also offer individual well bonds for smaller operators or require them for high-risk wells.
Bond amounts are set by state regulation and typically scale by well count or by the operator’s tier classification. The Texas Railroad Commission, COGCC, WOGCC, NMOCD, and NDIC each have their own forms and their own adequacy calculations. We know how each commission works and help operators understand their obligations before they submit paperwork.
Your blanket bond program may be underweight
States are tightening blanket bond adequacy requirements as orphan well backlogs grow. Historically, statewide blanket bonds were set at minimal amounts – sometimes a few thousand dollars covering dozens or hundreds of wells. That era is ending. Colorado, Wyoming, North Dakota, and New Mexico are all actively raising the floor on what constitutes an adequate bond program.
Most states now classify operators by tier based on well count and production levels, and bond amount requirements scale accordingly. If your blanket bond program was structured more than a few years ago and hasn’t been reviewed, there’s a real chance it no longer meets your state’s current adequacy standards. The risk isn’t theoretical – regulators are enforcing. We help operators understand where they stand before the conservation commission tells them.
BLM federal oil and gas lease bonds
Operators on federal mineral acreage managed by the Bureau of Land Management are required to post federal lease bonds separately from their state conservation commission bonds. BLM offers three bond options: an individual lease bond covering a specific lease, a statewide bond covering all federal operations within a state, and an area-wide bond covering all federal operations within a defined BLM field office area.
The statewide bond is the most efficient option for operators with multiple federal leases, but the adequacy requirements and the application process differ from state conservation commission programs. We place BLM federal lease bonds and help operators understand which bond option makes sense for their federal acreage footprint.
BOEM offshore decommissioning bonds
Offshore oil and gas operations involve financial assurance requirements administered by the Bureau of Ocean Energy Management. BOEM has become significantly more active in requiring operators to post financial assurance for platform and well decommissioning, and bond amounts for offshore accounts can be substantial.
BOEM uses its own decommissioning cost models to determine financial assurance amounts, and the underwriting considerations for offshore bonds differ from onshore programs. We place BOEM offshore decommissioning bonds and understand how offshore financial assurance works alongside BLM onshore obligations for operators with both.
Place your pipeline and midstream bonds with an agency that knows the space
Pipeline developers, midstream operators, and oilfield contractors all carry bond requirements tied to their projects, their operating licenses, and their federal regulatory obligations. Right-of-way bonds, construction performance and payment bonds, pipeline operator license bonds, and FERC bonds for interstate pipelines each involve different obligees and different regulatory frameworks.
We place the full range of pipeline and midstream bonds and understand how federal and state pipeline bonding obligations interact. If your project involves a new pipeline, a gathering system, a processing facility, or a transmission line, we can cover the surety requirements from permitting through construction and into operations.
Pipeline right-of-way and performance bonds
Pipeline construction requires right-of-way bonds for easements across private land, state land, and federal land. These bonds guarantee that the pipeline operator will construct the line per the easement terms and restore the surface to an approved condition. Landowners, state agencies, state DOTs for road crossings, and federal agencies each have their own bond requirements depending on whose land is being crossed.
Performance and payment bonds for pipeline construction protect project owners against contractor default and protect subcontractors and suppliers against nonpayment. For pipeline EPC projects, these bonds are standard requirements and we place them alongside right-of-way bonds as part of a complete project bond program.
FERC pipeline and LNG facility bonds
Interstate natural gas pipelines and LNG facilities regulated by FERC carry federal bond requirements separate from state pipeline operator license bonds. FERC bonds guarantee compliance with the terms of the certificate of public convenience and necessity – the federal authorization to construct and operate interstate pipeline infrastructure.
We place FERC pipeline bonds and understand how federal pipeline bonding obligations interact with state-level requirements for operators that cross state lines or operate in multiple jurisdictions.
CO2 pipeline and carbon capture bonds
CO2 pipeline bonds for carbon capture transport infrastructure are an emerging requirement developing alongside the regulatory framework for CCS projects. Underground injection control bonds for Class VI CO2 sequestration wells are required by the EPA as a condition of the UIC Class VI permit – the federal authorization to inject CO2 underground for permanent storage.
Very few surety agencies have published content or built operational experience in this space. We’re positioned to serve CCS operators now, as the regulatory framework develops and before the market matures. If you’re developing a carbon capture project and working through your bonding obligations, we can have that conversation with real depth.
Satisfy your regulatory and environmental financial assurance obligations
Beyond plugging bonds and pipeline bonds, oil and gas operators carry a range of regulatory and environmental financial assurance bond requirements that vary by state and by operation type. Surface use and reclamation bonds, produced water disposal bonds, underground injection control bonds, and environmental financial assurance bonds are all part of a complete operator compliance program.
Surface use and reclamation bonds
Surface use and reclamation bonds cover the disturbance and restoration of well pads, access roads, and surface facilities associated with drilling and production operations. These bonds are required by some states in addition to the plugging bond, and by landowners and surface owners as a condition of surface use agreements on private land.
The surface use bond and the plugging bond address different obligations – one covers surface restoration during the operational phase, the other covers well decommissioning at end of life. We help operators understand which bonds their specific operations require and structure the program to satisfy all obligees without unnecessary duplication.
Underground injection control bonds
EPA Class II underground injection control bonds are required for saltwater disposal wells – the most common injection well type in oil and gas producing states. Class VI UIC bonds are required for CO2 sequestration wells under the EPA’s underground injection control program. Requirements vary by state depending on whether the state has an approved UIC primacy program.
We place UIC bonds for both Class II disposal operations and Class VI sequestration wells and understand how state-administered UIC programs differ from federally administered ones.
Performance and payment bonds for oilfield contractors
Drilling contractors, oilfield services companies, and EPC contractors building refineries, processing plants, and compression facilities all carry construction bond requirements. Performance bonds guarantee contractor completion of the project per contract terms. Payment bonds protect subcontractors and suppliers against nonpayment in the event of contractor default.
We place performance and payment bonds for oilfield construction projects of all sizes – from drilling contract bonds for individual well programs to large EPC bonds for refinery and processing facility construction. We also place supply and service contract bonds for oilfield service agreements where the client requires performance security from their contractor.
Don't let a letter of credit be your default answer
Most oil and gas operators default to letters of credit or cash deposits for financial assurance – not because they’re the better option, but because that’s what they’ve always done or because their current agency doesn’t know how to place the surety alternative. Letters of credit tie up cash, draw on your banking capacity, and are demand instruments that the holder can draw at any time without having to prove default.
A surety bond requires no collateral, stays off your balance sheet, and gives the principal protection in a claims scenario that an LC simply doesn’t provide. For most oil and gas bond types, surety is the better instrument – and we can make that case clearly with your financial team.
For obligees that specifically require letter of credit format and won’t accept a bond, a surety-backed letter of credit may be worth exploring. The operator gets the on-demand payment language the obligee requires without restricting cash or drawing on banking capacity. We place these instruments as well and can walk through the economics with your CFO or treasurer.
Why oil and gas operators work with Evergreen Surety
We do surety only. No insurance products competing for our attention, no commercial lines accounts that get prioritized over energy bond programs. When an operator calls us, they’re talking to an agency that has built its entire practice around surety – not one that handles bonds as a line item on a broader book of business.
We know the state conservation commissions we work with. The Texas Railroad Commission, COGCC, WOGCC, NMOCD, and NDIC are obligees we deal with regularly. Each commission has its own bond forms, its own adequacy calculations, and its own approval process. Knowing how each agency operates before the conversation starts changes the outcome.
We have carrier relationships specifically for complex energy programs – including the large blanket bond programs and offshore financial assurance requirements that require carriers with real appetite for oil and gas risk. We’re appointed with 15 different carriers, which means when one says no we have real alternatives.
We work alongside your bankers, CPAs, and attorneys. Oil and gas operators deal with reserve-based lending facilities, royalty structures, and legal counsel involved in bond form review. We coordinate with your full financial and legal team as a matter of course.
If you can meet your obligations, we can tell your story. Your financial position, your reserve profile, your track record as an operator – these are the inputs that determine the quality of your bond program. Our job is to communicate that story to the right carrier, as effectively and efficiently as possible.
Let's review your bond program
Whether you need a new bond placed, your existing blanket program reviewed against current state adequacy thresholds, a BLM federal lease program structured, or a pipeline project bonded from right-of-way through construction, please call us.
Call Eddie Maxfield at 720-492-9258 or email him at emaxfield@evergreensurety.com