AZ SB1229

Adds definition of "horizontal hydraulic fracturing" as the technique of expanding or creating rock fractures from substantially horizontal wellbores by injecting water, fluids, chemicals and proppants under pressure to explore, drill, complete or produce oil or natural gas.

Prohibits the commissioner from allowing horizontal hydraulic fracturing in cycling of gas or other pressure maintenance and secondary recovery operations.

Classifies oil or gas produced using horizontal hydraulic fracturing as "illegal gas" or "illegal oil" under state conservation law.

Establishes civil penalties of at least $10,000 per day of operations for any person causing horizontal hydraulic fracturing to occur in Arizona, compared to $1,000 per day for other violations.

Adds groundwater contamination prevention to the state's public policy regarding oil and gas production and includes injection of fracturing fluids and production of flowback water as forms of waste under conservation rules.