HLS 13RS-1533 ORIGINAL
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Regular Session, 2013
HOUSE CONCURRENT RESOLUTI ON NO. 73
BY REPRESENTATIVE HENRY BURNS
MINERALS/RIGHTS-ROYALTY: Requests the Louisiana Mineral Law Institute to study
and make recommendations relative to timely payment of mineral royalties
A CONCURRENT RESOLUTI ON1
To urge and request the Louisiana Mineral Law Institute to study and make specific2
recommendations relative to legislation to define "timely payment" of mineral3
royalties and to establish parameters as to what constitutes "reasonable cause" for4
untimely or nonpayment of mineral royalties.5
WHEREAS, pursuant to R.S. 31:137, a mineral lessee is required to make timely and6
proper payment of royalties; and7
WHEREAS, present law provides remedies for a lessor who has not been paid timely8
or properly, and present law also provides that the mineral lessee shall not be subject to9
penalties, provided that the mineral lessee has reasonable cause for nonpayment; and10
WHEREAS, the terms, "timely payment" and "reasonable cause" are not statutorily11
defined, and no parameters have been provided by statutory law as to what constitutes timely12
payment or what constitutes reasonable cause for failing to make timely payment; and13
WHEREAS, House Bill No. 223 of the 2013 Regular Session was introduced to14
define or provide some parameters as to what constitutes timely payment; and15
WHEREAS, while most mineral lessees make a good faith effort to timely and16
properly pay mineral royalties to their lessors, there are lessees who take advantage of the17
lack of specificity in the law as to what constitutes timely payment, particularly when18
dealing with mineral owners of small tracts of land and who are less knowledgeable of the19
Mineral Code; and20 HLS 13RS-1533 ORIGINAL
HCR NO. 73
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WHEREAS, mineral lessees frequently raise the inability to complete property title1
work as a reasonable cause for nonpayment; and2
WHEREAS, since there is no statutory law establishing any time parameters in3
which to complete such title work, it is most frequently raised as a reasonable cause for4
nonpayment, and may at times be applied to all owners within a unit when it does not5
necessarily affect the calculation of royalties to all owners within the unit; and6
WHEREAS, some states with a very strong oil and gas industry, such as Oklahoma,7
have enacted laws which are more specific when addressing the issues of timeliness of8
royalty payments and marketability of title; and9
WHEREAS, with the increased activity and complexity with oil and gas exploration10
and production in Louisiana over the past several years, there is a growing need to amend11
the laws relative to defining "timely payment" and as to what constitutes a "reasonable12
cause" for late payment or nonpayment.13
THEREFORE, BE IT RESOLVED that the Legislature of Louisiana does hereby14
urge and request the Louisiana Mineral Law Institute to study and make specific15
recommendations relative to legislation to define "timely payment" of mineral royalties and16
to establish parameters as to what constitutes "reasonable cause" for untimely or nonpayment17
of mineral royalties.18
BE IT FURTHER RESOLVED that a suitable copy of this Resolution be transmitted19
to Mr. Keith B. Hall, the director of the Louisiana Mineral Law Institute.20
BE IT FURTHER RESOLVED the Louisiana Mineral Law Institute report its21
findings and recommendations in the form of specific proposed legislation to the Legislature22
of Louisiana on or before January 1, 2014.23
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Henry Burns HCR No. 73
Requests the Louisiana Mineral Law Institute to study and make specific recommendations
relative to legislation to define "timely payment" of mineral royalties and to establish
parameters as to what constitutes "reasonable cause" for untimely or nonpayment of mineral
royalties, and to report its findings and recommendations on or before January 1, 2014.