(a) General rule.--Upon application, the department shall grant inactive status for a period of five years for a permitted or registered well, if the following requirements are met:

(1) the condition of the well is sufficient to prevent damage to the producing zone or contamination of fresh water or other natural resources or surface leakage of any substance;

(2) the condition of the well is sufficient to stop the vertical flow of fluids or gas within the well bore and is adequate to protect freshwater aquifers, unless the department determines the well poses a threat to the health and safety of persons or property or to the environment;

(3) the operator anticipates construction of a pipeline or future use of the well for primary or enhanced recovery, gas storage, approved disposal or other appropriate uses related to oil and gas well production; and

(4) the applicant satisfies the bonding requirements of sections 3213 (relating to well registration and identification) and 3225 (relating to bonding), except that the department may require additional financial security for a well on which an alternative fee is being paid in lieu of bonding under section 3225(d).

(b) Monitoring.--The owner or operator of a well granted inactive status shall be responsible for monitoring the mechanical integrity of the well to ensure that the requirements of subsection (a)(1) and (2) are met and shall report the same on an annual basis to the department in the manner and form prescribed by departmental regulations.

(c) (Reserved).

(d) Return to active status.--A well granted inactive status under subsection (a) shall be plugged in accordance with section 3220 (relating to plugging requirements) or returned to active status within five years of the date inactive status was granted, unless the owner or operator applies for an extension of inactive status which may be granted on a year-to-year basis if the department determines that the owner or operator has demonstrated ability to continue meeting the requirements of this section and the owner or operator certifies that the well will be of future use within a reasonable period of time. An owner or operator who has been granted inactive status for a well which is returned to active status prior to expiration of the five-year period set forth in subsection (a) shall notify the department that the well has been returned to active status and shall not be permitted to apply for another automatic five-year period of inactive status for the well. The owner or operator may make application to return the well to inactive status, and the application may be approved on a year-to-year basis if the department determines that the owner or operator has demonstrated an ability to continue meeting the requirements of this section and the owner or operator certifies that the well will be of future use within a reasonable period of time. The department shall approve or deny an application to extend a period of inactive status or to return a well to inactive status within 60 days of receipt of the application, and the application shall not be unreasonably denied. If the department has not completed its review of the application within 60 days, the inactive status shall continue until the department has made a determination on the request. If the department denies an application to extend the period of inactive status or to return a well to inactive status, a well owner or operator aggrieved by the denial shall have the right to appeal the denial to the Environmental Hearing Board within 30 days of receipt of the denial. Upon cause shown by a well owner or operator, the board may grant a supersedeas under section 4 of the act of July 13, 1988 (P.L.530, No.94), known as the Environmental Hearing Board Act, so that the well in question may retain inactive status during the period of the appeal.

(e) Revocation of inactive status.--The department may revoke inactive status and order immediate plugging of a well if the well is in violation of this chapter or rules or regulations promulgated under this chapter or if the owner or operator demonstrates inability to perform obligations under this chapter or becomes financially insolvent, or upon receipt by the department of notice of bankruptcy proceedings by the permittee.