By:  West (Senate Sponsor - Armbrister)                           H.B. No. 2440
	(In the Senate - Received from the House April 25, 2005; 
April 26, 2005, read first time and referred to Committee on 
Natural Resources; May 20, 2005, reported favorably by the 
following vote:  Yeas 9, Nays 0; May 20, 2005, sent to printer.)


A BILL TO BE ENTITLED

AN ACT


relating to the regulation by the Railroad Commission of Texas of 
activities associated with multiple accumulations of hydrocarbons 
from which production by commingling of hydrocarbons is authorized.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 86.081(b), Natural Resources Code, is 
amended to read as follows:
	(b)  When, as provided in Subsection (b) of Section 85.046 or 
Subsection (b) of Section 86.012 [of this code, as amended], the 
commission has permitted production by commingling oil or gas or 
oil and gas from multiple stratigraphic or lenticular accumulations 
of oil or gas or oil and gas, the commission may regulate all 
activities that are under its jurisdiction and associated with
[prorate, allocate, and regulate the production of] such 
commingled, separate multiple stratigraphic or lenticular 
accumulations of oil or gas or oil and gas as if the accumulations
[they] were a single common reservoir;  provided, however, that:
		(i)  such commingling shall not cause the allocation of 
allowable production from a well producing from any separate 
accumulation or accumulations to be less than that which would 
result from the commission applying the provisions of Section 
86.095 [of this code] to such accumulation or accumulations;  and
		(ii)  the allocation of the allowable for such 
commingled production shall be based on not less than two factors 
which the Railroad Commission shall take into account as directed 
by Section 86.089 [of this code].
	SECTION 2.  The change in law made by this Act applies only 
to an activity that occurs on or after the effective date of this 
Act and that is associated with multiple accumulations of 
hydrocarbons from which the Railroad Commission of Texas authorizes 
production by commingling of hydrocarbons, as provided by Section 
85.046(b) or 86.012(b), Natural Resources Code, regardless of 
whether the authorization occurs before, on, or after the effective 
date of this Act.
	SECTION 3.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2005.



* * * * *