HBA-AMW, CBW H.B. 2436 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 2436 By: Merritt Energy Resources 7/19/2001 Enrolled BACKGROUND AND PURPOSE The East Texas Oil Field (field) is not only the largest oil field in Texas, it is also the most productive in the lower 48 states. The field, which covers several counties, has produced more than 5.3 billion barrels of oil since its discovery in 1930. The impact of this oil treasure on the Texas economy, especially the local economies surrounding the field, has been tremendous. However, production has been declining rapidly and, if new approaches to capturing oil from the field are not implemented, effective production of oil could end by 2006. House Bill 2436 requires the Bureau of Economic Geology of The University of Texas at Austin to conduct a two-year project to provide a comprehensive reservoir characterization and engineering study of the field to optimize production strategies. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 2436 amends the Natural Resources Code to create the East Texas Oil Field Advisory Committee (committee) and to require the Bureau of Economic Geology of The University of Texas at Austin (bureau) to conduct a study of the East Texas Oil Field. The bill sets forth provisions regarding the operation and administration of the committee and provides that the committee is composed of : _a member of the Railroad Commission of Texas (commission) appointed by the commission; _a member of the board of a school district, appointed by the commission; _a representative of the oil industry, appointed by the commission; _a member of the senate, appointed by the lieutenant governor; and _a member of the house of representatives, appointed by the speaker of the house of representatives. The bill requires the bureau to make an interim report on or before January 1, 2003, and a final report on or before September 1, 2003, to the governor, the lieutenant governor, and the speaker of the house of representatives containing recommendations regarding measures that should be taken to maximize the ultimate recovery of oil and gas from the East Texas Oil Field. These provisions expire and the committee is abolished September 1, 2003. The bill sets forth requirements for the commission relating to appointing members to the committee as soon as practicable. H.B. 2436 specifies that the bureau is required to conduct the study of the East Texas Oil Field and to make the interim and final reports only if the legislature appropriates money specifically for that purpose. The bill authorizes the bureau, if the legislature does not appropriate money specifically for the study, to implement the study using other appropriations available and provides that the persons required to appoint the members of the committee are required to appoint the members only if the bureau is required to or chooses to implement the study. EFFECTIVE DATE September 1, 2001.