CADDNAR

[CITE: DNR v. Estate of Shoultz and Whitehouse, et al., 10 CADDNAR 165 (2005)]

FINAL ORDER

1. The Shoultz Permits are hereby revoked.

2. Respondents, the Estate of Gearl W. Shoultz, Deceased and Danny Joe Whitehouse and Shannon K. Whitehouse, as Personal Representatives of the Estate of Gearl W. Shoultz, Deceased, are ordered to properly plug and abandon each well authorized by the Shoultz Permits as well as perform site restoration required by 312 IAC 16-5-19(c).

3. A statutory lien is foreclosed in favor of the Department on the casing and all equipment located on or removed from each well site authorized by the Shoultz Permits as well as on the leasehold of the land upon which each well authorized by the Shoultz Permits is located and upon any crude oil stored on the well site or recovered at the time the well is plugged and abandoned.

4. If the Natural Resources Commission elects to plug and abandon the wells, the Commission may enter an order authorizing the agents, employees, or contractors to dispose of the casing and all equipment located on or removed from the well site and any crude oil stored on the well site or recovered at the time the well is plugged and abandoned. An inventory of the casing and all equipment and any crude oil shall be made, and the salvage or other reasonable market value of the casing, all equipment and any crude oil shall be applied as a credit to offset the actual costs incurred by the Commission in plugging and abandoning the well.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

1. On March 1, 2005, the Department of Natural Resources, Division of Oil and Gas ("Department") filed its "Complaint for the Issuance of an Order to Revoke Permits" against Gearl Shoultz ("Shoultz").

2. The permits at issue are numbered 45754, 45755 and 48351 ("Shoultz Permits").

3. A prehearing conference was held on April 5, 2005 at which time Dan Whitehouse ("Whitehouse") appeared on behalf of Shoultz. Whitehouse advised that Shoultz was deceased and further that Shoultz's Last Will and Testament bequeathed the oil and gas wells at issue in this proceeding to Whitehouse.

4. A telephone status conference was held on June 7, 2005, at which time Whitehouse, present in person and by counsel, advised of his decision not to proceed with transfer of the Shoultz Permits.

5. On July 5, 2005, the Estate of Gearl W. Shoultz, deceased and Danny Joe Whitehouse and Shannon K. Whitehouse, in their capacities as the Personal representative of the

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Estate of Gearl W. Shoultz, Deceased, were substituted as Respondents to this proceeding.

6. On August 3, 2005, Danny Joe Whitehouse and Shannon K. Whitehouse, individually and in their capacities as Personal Representatives of the Estate of Gearl W. Shoultz, filed their "Affidavit of the Personal Representatives of the Estate of Gearl Shoultz" therein consenting to the Department's sought revocation of the Shoultz Permits.