2021 Regular Session ENROLLED
SENATE CONCURRENT RESOL UTION NO. 44
BY SENATOR HENSGENS
A CONCURRENT RESOL UTION
To create the Risk Charge Commission to study and make recommendations regarding the
costs and risks in drilling a well in a compulsory unit created by the office of
conservation.
WHEREAS, the drilling of oil and gas wells is an important sector of Louisiana's
economy, and the policy of this state is advanced when wells are drilled under circumstances
that the associated risk is equitably shared by parties who would share in the reward of such
undertakings; and
WHEREAS, in 1984, R.S. 30:10 was enacted by Act No. 345 to add statutory
provisions which in the oil and gas industry have been referred to as the "Louisiana Risk Fee
Act"; and
WHEREAS, the purpose of this legislation was to incentivize a party to share in the
cost and risk of drilling a well in a compulsory unit created by the office of conservation, and
concomitantly, to compensate a party for the risk that it assumes in drilling a well; and
WHEREAS, when the Louisiana Risk Fee Act was amended by Act No. 743 of the
2012 Regular Session, many raised concerns that those provisions may serve as a
disincentive to participate in the risk in drilling a unit well; and
WHEREAS, Senate Resolution No. 31 of The 2016 Second Extraordinary Session
in response to those concerns urged and requested the Louisiana State Law Institute to
propose legislation regarding the issue, the substance of which is contained in Senate Bill
No. 59 filed this session; and
WHEREAS, with remaining concerns of stakeholders that include costs and risks of
subsequent operations, notices, and unleased interests it is imperative that experts and
representatives of stakeholders be convened to conduct a thorough analysis of the entirety
of the Louisiana Risk Fee Act before a comprehensive solution to these issues can be
considered by the Louisiana Legislature.
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THEREFORE, BE IT RESOLVED that the Legislature of Louisiana does hereby
create the Risk Charge Commission to study current R.S. 30:10 relative to risks and cost of
drilling in a compulsory unit created by the office of conservation and the changes proposed
in response to Senate Resolution No. 31 of the 2016 Second Extraordinary Session, to
conduct public meetings, receive public comments and input of interested parties, and to
submit recommendations to the Senate Committee on Natural Resources and the House
Committee on Natural Resources and Environment no later than February 4, 2022. The
commission shall terminate upon the date of submission of the report or February 4, 2022,
whichever occurs first.
BE IT FURTHER RESOLVED that the commission created shall consist of the
following members:
(1) One member appointed by the president of the Senate.
(2) One member appointed by the speaker of the House of Representatives.
(3) One member appointed by the chairman of the Senate Committee on Natural
Resources who represents mineral owners.
(4) One member appointed by the chairman of the House Committee on Natural
Resources and Environment who represents operators.
(5) The secretary of the Department of Natural Resources, or his designee.
(6) The commissioner of conservation, or his designee.
(7) One member appointed by the Louisiana State Law Institute.
(8) One member appointed by the Louisiana Landowners Association.
(9) One member appointed by the Louisiana Oil and Gas Association.
(10) One member appointed by the Louisiana Mid-Continent Oil and Gas
Association.
(11) One member appointed by the Louisiana chapter of the National Association of
Royalty Owners.
(12) One member appointed by the Louisiana Association of Business and Industry.
BE IT FURTHER RESOLVED that the commission shall elect a chair at its first
meeting. A majority of the members of the commission shall constitute a quorum for the
purpose of taking any action. The members of the commission shall receive no compensation
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for their service to the state, except per diem or expenses reimbursement to which they may
be individually entitled as members of the constituent organizations.
BE IT FURTHER RESOLVED that a copy of this Resolution be transmitted to the
secretary of the Department of Natural Resources, the commissioner of conservation, the
Louisiana State Law Institute, the executive director of the Louisiana Landowners
Association, the president of the Louisiana Oil and Gas Association, the president of the
Louisiana Mid-Continent Oil and Gas Association, and the president of Louisiana chapter
of the National Association of Royalty Owners.
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
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