Articles Posted in Texas Railroad Commission

From Texas Tribune:

A major metro paper endorses a third-party statewide candidate… The Houston Chronicle has endorsed Libertarian Mark Miller in the race to replace David Porter on the three-member Texas Railroad Commission.

“Our editorial board interviews scores of candidates for political office every election year, but seldom do we find ourselves wholeheartedly endorsing a nominee from the Libertarian Party,” the editorial board wrote Tuesday night.  “Then again, seldom have we met a Libertarian candidate like Mark Miller.”

Ryan Sitton is interviewed by Evan Smith of The Texas Tribune. And endorses Donald Trump. And questions the human causes of climate change.  Watch the interview here.

The draft Sunset Commission report on the Texas Railroad Commission makes recommendations for legislative changes to the bonding requirements for oil and gas wells. Landowners should be familiar with how the RRC’s bonding system works, and how it could affect operations on their property.

Operators of oil and gas wells in Texas must have a permit to operate. In order to obtain that permit, the operator must provide financial security in the form of cash, a bond, or a letter of credit to provide financial assurance that it will plug any wells it operates. The amount of financial security required is set by statute and was last revised in 1991. Most operators comply with the bonding requirement by furnishing “blanket” bonds. The amount of the bond depends on the number of wells operated by the operator:

• Operators with 1-10 wells must have a $25,000 blanket bond.
• Operators with 11-99 wells must have a $50,000 blanket bond.
• Operators with 100 or more wells must have a $250,000 blanket bond.

The theory is that, if an operator becomes insolvent and is unable to plug its wells, the RRC can call on the bonding company to provide the money to plug the wells. But in reality, bonds provide only about 16% of the cost of plugging abandoned wells. In FY 2015, the RRC collected $4.288 million on bonds from 94 operators who abandoned 1,584 wells – an average of only $2,707 per well. In the same year, the RRC spent $11.722 million plugging 692 wells – an average of $17,012 per well. Continue reading →

The Sunset Advisory Commission staff have issued their draft report on the Texas Railroad Commission. Sunset review of the RRC has been controversial. This is the third time the agency has gone through sunset review since 2010, although most agencies aren’t reviewed by the Sunset Commission more than once every twelve years. Previous sunset review reports, like the current draft, have been critical of some aspects of the RRC’s structure and work. Because the RRC’s principal jurisdiction is over the regulation of oil and gas exploration and production and pipelines, its functioning is important to land and mineral owners, and those owners should be familiar with how the RRC works and what its responsibilities are and should consider weighing in on issues raised by the Sunset Commission Report.

First, a little background on the sunset review process. The Sunset Commission is required by statute to periodically review the performance of all state agencies and make recommendations on whether they should continue to exist and how they could improve their performance. The idea is that all agencies “sunset” — cease to exist — unless the legislature re-authorizes the agency after review by the Sunset Commission. About 130 state agencies are subject to review under the Texas Sunset Act. Agencies typically undergo sunset review every 12 years.

Continue reading →

Republican candidates for the open seat on the Texas Railroad Commission were interviewed by Evan Smith of the Texas Tribune in an open forum yesterday. They were asked about global warming, earthquakes, the EPA, House Bill 40 and municipal regulation of drilling, Sunset Commission review of the Commission in the upcoming legislative session, and the role of the Commission in both regulating and promoting oil and gas development in the state. You can watch the forum here. The Tribune has apparently decided not to hold a similar forum for the Democratic candidates running for the same seat.

My take:

• With two exceptions, the candidates refused to admit that human activity contributes to global warming, although they did appear to admit that global warming is occurring.

The Texas Railroad Commission website includes a tool it calls the Public GIS Viewer, that all mineral owners should become familiar with. It can be found at http://wwwgisp.rrc.state.tx.us/GISViewer2/, and it looks like this (click to enlarge):

The RRC website also has a page showing you how to use the viewer, found here.

You can locate wells and permits, and find permit plats, P-12’s, and other records in the permit file. Spend a little time playing around on the viewer to become familiar with its tools.