Utah State Geothermal Lease (3-UT-a)
“It is declared to be in the public interest to foster, encourage, and promote the discovery, development, production, utilization, and disposal of geothermal resources in the State of Utah in such manner as will prevent waste, protect correlative rights, and safeguard the natural environment and the public welfare; to authorize, encourage, and provide for the development and operation of geothermal resource properties in such manner that the maximum ultimate economic recovery of geothermal resources may be obtained through, among other things, agreements for cooperative development, production, injection, and pressure maintenance operations.”
Geothermal resources are governed by correlative rights in Utah, meaning that the rights of each geothermal owner may produce their equitable share of the resource without waste and without infringing on the other’s rights underlying their geothermal area.The Utah Division of Forestry, Fire and State Lands and, on specially designated lands, the Utah School and Institutional Trust Lands Administration will issue geothermal steam leases for the development of the geothermal resource below those lands. In addition, anywhere within the state, the developer will be required to file a permit to appropriate the geothermal fluids from the Utah Division of Water Rights.
State Geothermal Lease Process
3-UT-a.1 – Geothermal Steam Lease, See Flowchart 3-UT-d
Ownership of a geothermal resource is derived from an interest in land and not from any appropriate right to geothermal fluids or any mineral rights (UC 73-22-4). Therefore, to obtain access to a geothermal resource in Utah on state lands, the developer should obtain a surface interest from the state in the form of a geothermal steam lease. This lease grants the lessee the right to the surface to develop the underlying geothermal resources. The process for obtaining a geothermal steam lease can be found in the following flowchart:
3-UT-a.2 – Water Access & Water Rights, See Flowchart 19-UT-a
Although the ownership of geothermal resources is derived from the interest in land, the actual geothermal fluids are deemed by the state of Utah to be a special kind of undergroundwater resource (UC 73-22-8). This water resource has the potential to affect other water resources of the state and is therefore regulated by the Utah Division of Water Rights.
Geothermal owners must, “prior to the commencement of, or increase in, production from a well or group of wells to be operated in concert, file an application with the division to appropriate such geothermal fluids as will be extracted from the well or group of wells.” UC 73-22-8. Utilization of geothermal fluids for their thermal content and subsurface injection or disposal is considered beneficial use of the water in Utah and geothermal projects are considered as any other use of water within the state by UDWR. Applications to appropriate the geothermal fluids will be approved if the UDWR finds that the applicant is the geothermal owner and that the proposed extraction of geothermal fluids will not impair existing rights to waters of the state.
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- UC 73-22 Utah Geothermal Resources Conservation Act