By: Haywood S.B. No. 1551
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the repeal of certain provisions of the Natural
1-2 Resources Code limiting the Railroad Commission's authority with
1-3 respect to the regulation of production from multiple stratigraphic
1-4 oil and gas reservoirs.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Sections 85.053(b), 85.055(d), and 86.081(b)
1-7 Natural Resources Code, are amended to read as follows:
1-8 Sec. 85.053. Distribution, Proration, and Apportionment of
1-9 Allowable Production
1-10 (b) When, as provided in Subsection (b) of Section 85.046
1-11 and Subsection (b) of Section 86.012 of this code, as amended, the
1-12 commission has permitted production by commingling oil or gas or
1-13 oil and gas from multiple stratigraphic or lenticular accumulations
1-14 of oil or gas or oil and gas, the commission may distribute,
1-15 prorate, apportion, or allocate the production of such commingled
1-16 separate multiple stratigraphic or lenticular accumulations of oil
1-17 or gas or oil and gas as if they were a single pool; provided,
1-18 however, that:
1-19 ((i) the commingling and distribution, proration,
1-20 apportionment, or allocation of separate accumulations with
1-21 commission established discovery dates after January 1, 1945, shall
1-22 not serve to expand, add to, or extend the vertical or areal extent
1-23 of any single pool;)
2-1 ((ii))(i) such commingling shall not cause the
2-2 allocation of allowable production from a well producing from any
2-3 separate accumulation or accumulations to be less than that which
2-4 would result from the commission applying the provisions of Section
2-5 86.095 of this code to such accumulation or accumulations, and
2-6 ((iii))(ii) the allocation of the allowable for such
2-7 commingled production shall be based on not less than two factors
2-8 which the Railroad Commission shall take into account as directed
2-9 by Section 86.089 of this code. (; and
2-10 (iv) No gas well in any field falling within the
2-11 classification under Subdivision (i) above where commingled
2-12 separate accumulations of gas are being prorated under the
2-13 authority granted by this Subsection (b) shall be assigned an
2-14 allowable in excess of its production during the most recent
2-15 production period reported to the commission and in the absence of
2-16 any reported production the assigned allowable shall not exceed the
2-17 open-flow potential of such well as reported to the commission;
2-18 provided, however, that the commission may, if it finds special
2-19 conditions require such, make a greater assignment.)
2-20 Sec. 85.055. Allowable Production of Gas
2-21 (d) When, as provided in Subsection (b) of Section 85.045 or
2-22 Subsection (b) of Section 86.012 of this code, as amended, the
2-23 commission has permitted production by commingling oil or gas or
2-24 oil and gas from multiple stratigraphic or lenticular accumulations
2-25 of oil or gas or oil and gas, the commission may distribute,
3-1 prorate, apportion, or allocate the production of such commingled
3-2 separate multiple stratigraphic or lenticular accumulations of oil
3-3 or gas or oil and gas as if they were a single pool; provided,
3-4 however, that:
3-5 ((i) the commingling and distribution, proration,
3-6 apportionment, or allocation of separate accumulations with
3-7 commission established discovery dates after January 1, 1945, shall
3-8 not serve to expand, add to, or extend the vertical or areal extent
3-9 of any single pool;)
3-10 ((ii))(i) such commingling shall not cause the
3-11 allocation of allowable production from a well producing from any
3-12 separate accumulation or accumulations to be less than that which
3-13 would result from the commission applying the provisions of Section
3-14 86.095 of this code to such accumulation or accumulations, and
3-15 ((iii))(ii) the allocation of the allowable for such
3-16 commingled production shall be based on not less than two factors
3-17 which the Railroad Commission shall take into account as directed
3-18 by Section 86.089 of this code. (; and
3-19 no gas well in any field falling within the classification under
3-20 Subdivision (i) above where commingled separate accumulations of
3-21 gas are being prorated under the authority granted by this
3-22 Subsection (b) shall be assigned an allowable in excess of its
3-23 production during the most recent production period reported to the
3-24 commission and in the absence of any reported production the
3-25 assigned allowable shall not exceed the open-flow potential of such
4-1 well as reported to the commission, provided, however, that the
4-2 commission may, if it finds special conditions require such, make a
4-3 greater assignment.)
4-4 SECTION 86.081. Regulation of Production
4-5 (b) When, as provided in Subsection (b) of Section 85.046 or
4-6 Subsection (b) of Section 86.012 of this code, as amended, the
4-7 commission has permitted production by commingling oil or gas or
4-8 oil and gas from multiple stratigraphic or lenticular accumulations
4-9 of oil or gas or oil and gas, the commission may distribute,
4-10 prorate, apportion, or allocate and regulate the production of such
4-11 commingled, separate multiple stratigraphic or lenticular
4-12 accumulations of oil or gas or oil and gas as if they were a single
4-13 pool; provided, however, that:
4-14 ((i) the commingling and distribution, proration,
4-15 apportionment, or allocation of separate accumulations with
4-16 commission established discovery dates after January 1, 1945, shall
4-17 not serve to expand, add to, or extend the vertical or areal extent
4-18 of any single pool.)
4-19 ((ii))(i) such commingling shall not cause the
4-20 allocation of allowable production from a well producing from any
4-21 separate accumulation or accumulations to be less than that which
4-22 would result from the commission applying the provisions of Section
4-23 86.095 of this code to such accumulation or accumulations; and
4-24 ((iii))(ii) the allocation of the allowable for such
4-25 commingled production shall be based on not less than two factors
5-1 which the Railroad Commission shall take into account as directed
5-2 by Section 86.059 of this code. (; and
5-3 no gas well in any field falling within the classification under
5-4 Subdivision (i) above where commingled separate accumulations of
5-5 gas are being prorated under the authority granted by this
5-6 Subsection (b) shall be assigned an allowable in excess of its
5-7 production during the most recent production period reported to the
5-8 commission and in the absence of any reported production the
5-9 assigned allowable shall not exceed the open-flow potential of such
5-10 well as reported to the commission; provided, however, that the
5-11 commission may, if it finds special conditions require such, make a
5-12 greater assignment.)
5-13 SECTION 2. The importance of this legislation and the
5-14 crowded condition of the calendars in both houses create an
5-15 emergency and an imperative public necessity that the
5-16 constitutional rule requiring bills to be read on three several
5-17 days in each house be suspended, and this rule is hereby suspended.