Oklahoma Senate Bill SB1003

Oklahoma 2022 Regular Session

• Introduced: 2/1/21
• Refer: 2/2/21

Caption

Oil and gas; extending time allowed to pay certain proceeds. Effective date.

Impact

The changes proposed in SB1003 are expected to have a significant effect on the state’s oil and gas industry. By lengthening the payment timelines, the bill could alleviate some financial pressures faced by production companies, potentially allowing them to improve operational efficiency. Nevertheless, this could also result in delayed earnings for landowners and royalty interest holders, potentially leading to cash flow challenges for individuals depending on these payments.

Summary

Senate Bill 1003 aims to amend the Production Revenue Standards Act of Oklahoma, particularly addressing the timelines for the payment of proceeds from the sale of oil and gas production. The bill proposes to extend the time allowed for companies to pay the proceeds to the rightful owners from six to nine months after the first sale date. This adjustment is intended to provide more flexibility for operators, ensuring they can manage cash flow and investment in operations more effectively.

Contention

Notable points of contention surrounding SB1003 stem from the balance it seeks between providing operational flexibility for oil and gas companies and ensuring prompt payment to owners entitled to proceeds. Opponents may argue that extending payment deadlines can obstruct the financial rights of landowners and could be seen as favoring corporate interests over those of individual citizens. Advocates for the bill may counter that these changes are necessary to maintain a competitive industry in Oklahoma.