Before any person shall commence the drilling of any well in search of oil or gas, the person shall file with the board his application for a permit to drill, accompanied by a certified plat and by a fee of Six Hundred Dollars ($600.00), payable to the State Oil and Gas Board. When two (2) or more separately owned tracts of land are embraced within the unit for which the permit is sought, the application shall affirmatively state whether there are separately owned tracts in the drilling unit for which the permit is sought, and if so, whether the person owning the drilling rights therein and the rights to share in the production therefrom have agreed to develop their lands as a drilling unit and to the drilling of the well, as contemplated by Section 53-3-7. If drilling operations have not commenced within one (1) year after date of issuance, the permit shall become void. If the application complies in all respects with the rules and regulations of the board relating thereto, a permit shall be issued promptly by the supervisor. The issuance of the permit shall constitute the establishment of the drilling unit as designated in the application and shall likewise constitute the approval of the well location set out in the permit. On good cause shown, the unit may be altered by the board after notice and hearing.

If the application for permit does not comply in all respects with the rules and regulations of the board relating thereto, the application shall be disallowed and the supervisor shall promptly notify the applicant of the reason or reasons for the disallowance.