La. Admin. Code tit. 43 § I-1156

Current through Register Vol. 50, No. 9, September 20, 2024

Section I-1156 - Bankruptcy or Lapse of Financial Assurance or Insurance

A. If the lessee becomes bankrupt or insolvent, or if the approved financial assurance expires for any reason, the lessee shall:

1. notify the board or its authorized representative within five business days of the expiration of existing financial assurance and/or insurance. Lessee's failure to renew or obtain new financial assurance and/or insurance prior to the expiration of existing financial assurance and/or insurance shall automatically suspend all rights granted to the lessee under the AESL. lessee's failure to obtain coverage within 90 days after termination of the required security and/or insurance shall result in termination of the AESL;

2. notify the board or its authorized representative within five business days of the initiation of any judicial or administrative proceeding alleging insolvency or bankruptcy;

3. notify the board or its authorized representative within five business days after the lessee learns of any action filed alleging that the lessee's surety, or third-party guarantor, is insolvent or bankrupt.

B. If the approved financial assurance and/or insurance expire for any reason:

1. prior to the cancellation of the security or insurance required by this Subpart, if the lessee does not provide the Lessor evidence that a new security or insurance has been obtained meeting all of the requirements of this Subpart, all rights granted to the lessee under the AESL shall automatically and, without further notice to the lessee, be suspended;

2. the lessee shall immediately suspend operations under the AESL except for those operations necessary to maintain the safety of already ongoing operations. The lessee shall provide evidence to the board or its authorized representative by providing sufficient documentation demonstrating the reinstatement of the requisite security and/or insurance;

3. upon the reinstatement of the requisite security and/or insurance, the lessee will be allowed to resume operations;

4. should lessee fail to obtain coverage within 90 days after termination of the required security and/or insurance, the AESL shall terminate.

La. Admin. Code tit. 43, § I-1156

Promulgated by Department of Natural Resources, Office of Mineral Resources, LR 38:140 (January 2012).

AUTHORITY NOTE: Promulgated in accordance with R.S. 30:124.