27-551. Definitions

In this article, unless the context otherwise requires:

1. " Arizona refinery business" means a firm which markets in this state the product refined from royalty oil purchased under this article and which either owns and controls an oil refinery located within this state or is an Arizona corporation which owns an oil refinery in the United States located within one hundred miles of this state.

2. " Completion operations" means work performed in an oil or gas well after the well has been drilled to the point where the production string of casing is to be set, including setting the casing, perforating, artificial stimulation, production testing and equipping the well for production, all prior to the commencement of the actual production of oil or gas in paying quantities, or in the case of an injection or service well, prior to when the well is ready for use, or in the case of a dry hole, prior to when the well is plugged and abandoned.

3. " Department" means the state land department.

4. " Drilling operations" means any work or actual physical or mechanical operations undertaken or commenced in good faith for the purpose of bringing about the production of oil or gas in paying quantities, including the preparation of drill sites, followed diligently and in reasonable due course by the mobilization of a drilling rig and other necessary structures for the drilling of an oil or gas well and by actual drilling in the ground.

5. " Lease" means an oil and gas lease issued, extended or amended pursuant to the provisions of this article.

6. " Lessee" means the holder of an oil and gas lease issued pursuant to this article and includes any assignee of an original lessee.

7. " Oil and gas" and " oil or gas" includes oil, gas, other hydrocarbon substances, and helium or other substances of a gaseous nature.

8. " Produced" includes the words " procured and produced" .

9. " Refinery charge stocks" means crude oil, liquid petroleum or gas condensate and blends of such products and all other products charged or chargeable to petroleum refinery facilities.

10. " Reworking operations" means work performed at any depth on a well after its initial completion in an effort to secure production where there has been none, or to restore production that has ceased or to increase production.

11. " Royalty oil" means crude oil, liquid petroleum products or gas condensates from wells or lease plants or a mixture of such products.

12. " State lands" means any land or any interest therein owned or held in trust or otherwise by the state, including but not limited to leased school or university lands.

13. " Surface lease" means a lease on the surface of any state land for grazing, agricultural, commercial or homesite purposes.

14. " Surface lessee" means the holder of a lease on the surface of any state land for grazing, agricultural, commercial or homesite purposes.