1-1     By:  Ogden                                            S.B. No. 1545

 1-2           (In the Senate - Filed March 14, 1997; March 20, 1997, read

 1-3     first time and referred to Committee on Natural Resources;

 1-4     May 2, 1997, reported adversely, with favorable Committee

 1-5     Substitute by the following vote:  Yeas 7, Nays 1; May 2, 1997,

 1-6     sent to printer.)

 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 1545                   By:  Ogden

 1-8                            A BILL TO BE ENTITLED

 1-9                                   AN ACT

1-10     relating to the payment for proceeds derived from the sale of oil

1-11     or condensate from an oil or gas well located in this state.

1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-13           SECTION 1.  Subchapter J, Chapter 91, Natural Resources Code,

1-14     is amended by adding Section 91.407 to read as follows:

1-15           Sec. 91.407.  PAYMENT BY FIRST PURCHASER TO OPERATOR

1-16     CONSIDERED PROCEEDS. Absent a written notification between the

1-17     operator and each payee, a payment by the first purchaser of crude

1-18     oil or condensate to the operator is considered proceeds derived

1-19     from the sale of crude oil or condensate production; provided,

1-20     however, that the characterization given in the written

1-21     notification does not conclusively determine the character of the

1-22     payment by the first purchaser.

1-23           SECTION 2.  This Act takes effect September 1, 1997.

1-24           SECTION 3.  The importance of this legislation and the

1-25     crowded condition of the calendars in both houses create an

1-26     emergency and an imperative public necessity that the

1-27     constitutional rule requiring bills to be read on three several

1-28     days in each house be suspended, and this rule is hereby suspended.

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