87R19763 JXC-F     By: Raymond, Ellzey, Guillen, Longoria, H.B. No. 4442       Reynolds, et al.     Substitute the following for H.B. No. 4442:     By:  Reynolds C.S.H.B. No. 4442       A BILL TO BE ENTITLED   AN ACT   relating to the regulation of oil and gas waste; imposing a fee.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 85.2021, Natural Resources Code, is   amended by adding Subsection (b-1) to read as follows:          (b-1)  An applicant shall submit an additional nonrefundable   fee of $200 for a permit to drill, deepen, plug back, or reenter a   well for which the applicant proposes to use a reserve pit located   at the well site to dispose of oil and gas waste, as defined by   Section 91.1011, from the well.          SECTION 2.  Section 91.110, Natural Resources Code, is   amended to read as follows:          Sec. 91.110.  OIL AND GAS WASTE REDUCTION AND MINIMIZATION.   To encourage the reduction and minimization of oil and gas waste,   the commission shall implement a program to:                (1)  provide operators with training and technical   assistance on oil and gas waste reduction and minimization;                (2)  assist operators in developing oil and gas waste   reduction and minimization plans; and                (3)  by rule establish and offer well operators   incentives for oil and gas waste reduction and minimization through   the use of solids control equipment and closed-loop drilling   systems at well sites.          SECTION 3.  Section 91.113, Natural Resources Code, is   amended by adding Subsection (a-1) to read as follows:          (a-1)  Subsection (a) includes oil and gas waste or other   substances or materials regulated by the commission under Section   91.101 that are disposed of or stored at a well site using a reserve   pit, an aboveground tank, or other means.          SECTION 4.  Section 91.1132, Natural Resources Code, is   amended to read as follows:          Sec. 91.1132.  PRIORITIZATION OF HIGH-RISK WELLS. The   commission by rule shall develop a system for:                (1)  identifying abandoned wells that pose a high risk   of contaminating surface water or groundwater, including those with   reserve pits at the well site;                (2)  periodically testing high-risk wells by   conducting a fluid level test or, if necessary, a pressure test; and                (3)  giving priority to plugging high-risk wells with   compromised casings.          SECTION 5.  Subchapter D, Chapter 91, Natural Resources   Code, is amended by adding Section 91.118 to read as follows:          Sec. 91.118.  DISCLOSURE OF LOCATION OF NONCOMMERCIAL   SURFACE DISPOSAL. (a) In this section, "noncommercial surface   disposal" means the disposal of oil field fluids or oil and gas   waste at a facility:                (1)  for which the disposal is not a primary business   purpose; or                (2)  at which the disposal is performed without   compensation.          (b)  The commission by rule shall require the owner or   operator of a facility that performs noncommercial surface disposal   to file with the county clerk of the county where the disposal   occurs a notice of noncommercial surface disposal that includes a   legal description of the exact location of the noncommercial   surface disposal.          SECTION 6.  Sections 91.141(a) and (b), Natural Resources   Code, are amended to read as follows:          (a)  Owners and operators of oil and gas wells shall keep   books and records that show accurately:                (1)  the amount of sold and unsold stock;                (2)  the amount of promotion money paid;                (3)  the amount of oil and gas produced and disposed of   and the price for which the oil and gas was sold;                (4)  the volume and types of oil and gas waste generated   at each well site and the primary method of disposal of the waste,   including waste that is managed:                      (A)  at the well site;                      (B)  by a third-party commercial surface disposal   facility, as defined by Section 91.116; or                      (C)  by a recycling facility;                (5)  the receipts from the sale or transfer of leases or   other property; and                (6) [(5)]  disbursements made in connection with or for   the benefit of the business.          (b)  The books and records shall be kept open for the   inspection of the commission or any accredited representative of   the commission and any stockholder or shareholder or royalty owner   in the business.          SECTION 7.  Section 91.753, Natural Resources Code, is   amended to read as follows:          Sec. 91.753.  NOTICE REQUIRED. (a) Not later than the 15th   business day after the date the commission issues an oil or gas well   operator a permit to drill a new oil or gas well or to reenter a   plugged and abandoned oil or gas well, the operator shall give   [written notice of the issuance of the permit to] the surface owner   of the tract of land on which the well is located or is proposed to   be located written notice of:                (1)  the issuance of the permit; and                (2)  whether a reserve pit will be used to permanently   dispose of oil and gas waste on the surface owner's property,   including the estimated volume and types of waste to be disposed of   at the well site, if any.          (b)  An oil or gas well operator is not required to give   notice under this subchapter to a surface owner if:                (1)  the operator and the surface owner have entered   into a written [an] agreement that contains alternative provisions   regarding the operator's obligation to give notice of oil and gas   operations; or                (2)  the surface owner has waived in writing the owner's   right to notice under this subchapter.          SECTION 8.  Section 85.2021(b-1), Natural Resources Code, as   added by this Act, applies only to an application or materially   amended application that is submitted to the Railroad Commission of   Texas on or after the effective date of this Act. An application or   materially amended application submitted to the commission before   the effective date of this Act is governed by the law in effect when   the application or materially amended application was submitted,   and the former law is continued in effect for that purpose.          SECTION 9.  Section 91.753, Natural Resources Code, as   amended by this Act, applies only to a permit issued by the Railroad   Commission of Texas on or after the effective date of this Act. A   permit issued by the commission before the effective date of this   Act is governed by the law in effect when the permit was issued, and   the former law is continued in effect for that purpose.          SECTION 10.  This Act takes effect September 1, 2021.