Oklahoma 2022 Regular Session

Oklahoma Senate Bill SB632 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
	3	+	SB632 HFLR Page 1
	4	+	BOLD FACE denotes Com mittee Amendments. 1
	5	+	2
	6	+	3
	7	+	4
	8	+	5
	9	+	6
	10	+	7
	11	+	8
	12	+	9
	13	+	10
	14	+	11
	15	+	12
	16	+	13
	17	+	14
	18	+	15
	19	+	16
	20	+	17
	21	+	18
	22	+	19
	23	+	20
	24	+	21
	25	+	22
	26	+	23
	27	+	24
3	28
4		-	An Act
5		-	ENROLLED SENATE
	29	+	HOUSE OF REPRESENTATIVES - FLOOR VERSION
	30	+
	31	+	STATE OF OKLAHOMA
	32	+
	33	+	1st Session of the 58th Legislature (2021)
	34	+
	35	+	ENGROSSED SENATE
6	36		BILL NO. 632 By: Taylor of the Senate
7	37
8	38		and
9	39
10	40		McEntire of the House
11	41
12	42
13	43
14	44
15	45		An Act relating to the Oil and Gas Owners ’ Lien Act
16	46		of 2010; amending 52 O.S. 2011, Sections 549.2 and
17	47		549.3, which relate to definitions and oil and gas
18	48		liens; modifying definition; granting lien right to
19	49		secure obligation to pay certain proceeds; specifying
20	50		duration of certain lien; and providing an effective
21	51		date.
22	52
23	53
24	54
25	55
26	56
27		-	SUBJECT: Oil and gas
28		-
29	57		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
30		-
31	58		SECTION 1. AMENDATORY 52 O.S. 2011, Section 549.2, is
32	59		amended to read as follows:
33		-
34	60		Section 549.2.
35		-
36	61		DEFINITIONS
37		-
38	62		As used in the Oil and Gas Owners ’ Lien Act of 2010:
39		-
40	63		1. “Affiliate” means any person:
41		-
42	64		a. who is controlled, directly or indirectly, by a first
43	65		purchaser, or
44	66
	67	+	SB632 HFLR Page 2
	68	+	BOLD FACE denotes Com mittee Amendments. 1
	69	+	2
	70	+	3
	71	+	4
	72	+	5
	73	+	6
	74	+	7
	75	+	8
	76	+	9
	77	+	10
	78	+	11
	79	+	12
	80	+	13
	81	+	14
	82	+	15
	83	+	16
	84	+	17
	85	+	18
	86	+	19
	87	+	20
	88	+	21
	89	+	22
	90	+	23
	91	+	24
	92	+
45	93		b. who controls, directly or indirectly, a first
46	94		purchaser.
47		-
48		-	ENR. S. B. NO. 632 Page 2
49		-
50	95		“Control” or “controlled by” means the possession, directly or
51	96		indirectly, of the power to direc t or cause the direction of the
52	97		management and policies of a person, whether through ownership, by
53	98		contract, or otherwise;
54		-
55	99		2. “Agreement to sell” means any enforceable agreement, whether
56	100		express or implied, whether oral or written, by which an interest
57	101		owner, either directly or through a representative, agrees to sell
58	102		or is deemed by applicable contract or law to have agreed to sell
59	103		oil or gas upon or after severance to a first purchaser;
60		-
61	104		3. “Article 9” means Article 9 of the Oklahoma Uniform
62	105		Commercial Code in effect as of the relevant date or a comparable
63	106		article under the uniform commercial code of another state to the
64	107		extent applicable;
65		-
66	108		4. “First purchaser” means the first person that purchases oil
67	109		or gas from an interest owner, either directly or thr ough a
68	110		representative, under an agreement to sell;
69		-
70	111		5. “Gas” means natural gas and casinghead gas and all
71	112		constituent parts thereof both before and after processing but prior
72	113		to the time at which a first purchaser transfers title, possession
73	114		or control thereof to a purchaser;
74		-
75	115		6. “Interest owner” means a person owning an interest of any
76	116		kind or nature in oil and gas rights before the acquisition thereof
	117	+
	118	+	SB632 HFLR Page 3
	119	+	BOLD FACE denotes Com mittee Amendments. 1
	120	+	2
	121	+	3
	122	+	4
	123	+	5
	124	+	6
	125	+	7
	126	+	8
	127	+	9
	128	+	10
	129	+	11
	130	+	12
	131	+	13
	132	+	14
	133	+	15
	134	+	16
	135	+	17
	136	+	18
	137	+	19
	138	+	20
	139	+	21
	140	+	22
	141	+	23
	142	+	24
	143	+
77	144		by a first purchaser. Interest owner includes a representative and
78	145		a transferee interest owner;
79		-
80	146		7. “Oil” means oil and condensate and all constituent parts
81	147		thereof whether before or after processing but prior to the time at
82	148		which a first purchaser transfers title, possession or control
83	149		thereto to a purchaser;
84		-
85	150		8. “Oil and gas lien” means the lien granted by this act the
86	151		Oil and Gas Owners’ Lien Act of 2010 ;
87		-
88	152		9. a. “Oil and gas rights” means, as to any lands within the
89	153		State of Oklahoma, any right, title or interest,
90	154		whether legal or equitable, in and to:
91		-
92		-	ENR. S. B. NO. 632 Page 3
93		-
94	155		(1) oil,
95		-
96	156		(2) gas,
97		-
98	157		(3) proceeds,
99		-
100	158		(4) an oil and gas lease,
101		-
102	159		(5) a pooling order, and
103		-
104	160		(6) an agreement to sell.
105		-
106	161		b. By way of illustration and not limitation, oil and gas
107	162		rights include, but are not limited to:
108		-
109	163		(1) oil or gas in place prior to severance,
110		-
111	164		(2) oil or gas production, or the right to receive a
112	165		portion of the proceeds, upon severance,
113		-
114	166		(3) proceeds owed for oil and gas drilling and
115	167		development,
	168	+
	169	+	SB632 HFLR Page 4
	170	+	BOLD FACE denotes Com mittee Amendments. 1
	171	+	2
	172	+	3
	173	+	4
	174	+	5
	175	+	6
	176	+	7
	177	+	8
	178	+	9
	179	+	10
	180	+	11
	181	+	12
	182	+	13
	183	+	14
	184	+	15
	185	+	16
	186	+	17
	187	+	18
	188	+	19
	189	+	20
	190	+	21
	191	+	22
	192	+	23
	193	+	24
116	194
117	195		(4) proceeds from the acquisition of oil and gas
118	196		rights including but not limited to a lease bonus
119	197		or pooling bonus,
120		-
121	198		(5) proceeds from an unfulfilled contract or
122	199		agreement for the purchase of mineral rights,
123		-
124	200		(6) any interest or estate in, by, through or under
125	201		an oil and gas lease,
126		-
127	202		(4)
128		-
129	203		(7) rights acquired under a pooling order insofar as
130	204		such rights relate to: ownership of oil and gas,
131	205		the right to proceeds , or the right to enter into
132	206		an agreement to sell,
133		-
134	207		(5)
135		-
136		-	ENR. S. B. NO. 632 Page 4
137		-
138	208		(8) a legal or equitable right to receive
139	209		consideration of whatsoever nature under an
140	210		agreement to sell, or
141		-
142	211		(6)
143		-
144	212		(9) a mortgage lien or security interest in any of
145	213		the foregoing;
146		-
147	214		10. “Operator” means a person engaged in the severance of oil
148	215		or gas for that person alone, for other persons only, or for that
149	216		person and others;
150		-
151	217		11. “Permitted lien” means any of the following liens or
152	218		security interests:
	219	+
	220	+	SB632 HFLR Page 5
	221	+	BOLD FACE denotes Com mittee Amendments. 1
	222	+	2
	223	+	3
	224	+	4
	225	+	5
	226	+	6
	227	+	7
	228	+	8
	229	+	9
	230	+	10
	231	+	11
	232	+	12
	233	+	13
	234	+	14
	235	+	15
	236	+	16
	237	+	17
	238	+	18
	239	+	19
	240	+	20
	241	+	21
	242	+	22
	243	+	23
	244	+	24
153	245
154	246		a. a mortgage lien or security interest granted by a
155	247		first purchaser in favor of a person not an affiliate
156	248		of the first purchaser which mortgage lien or security
157	249		interest secures payment under a written instrument of
158	250		indebtedness signed by the first purchaser and
159	251		accepted in writing by the payee thereof prior to the
160	252		effective date of this act April 19, 2010, with a
161	253		principal amount and a fixed maturity stated therein;
162	254		provided, however, a permitted lien does not include a
163	255		mortgage lien or security interest which:
164		-
165	256		(1) secures payment of any indebtedness incurred from
166	257		and after the effective date of this act April
167	258		19, 2010,
168		-
169	259		(2) secures payment under a written instrument of
170	260		indebtedness not signed by a first purchaser and
171	261		accepted in writing by the payee thereof prior to
172	262		the effective date of this act April 19, 2010,
173		-
174	263		(3) secures payment under a written instrument of
175	264		indebtedness modified, amended or restated from
176	265		or after the effective date of this act April 19,
177	266		2010, which modification, amendment or
178	267		restatement increases the principal amount which
179		-
180		-	ENR. S. B. NO. 632 Page 5
181	268		was owing at the effective date of this act on
182	269		April 19, 2010,
	270	+
	271	+	SB632 HFLR Page 6
	272	+	BOLD FACE denotes Com mittee Amendments. 1
	273	+	2
	274	+	3
	275	+	4
	276	+	5
	277	+	6
	278	+	7
	279	+	8
	280	+	9
	281	+	10
	282	+	11
	283	+	12
	284	+	13
	285	+	14
	286	+	15
	287	+	16
	288	+	17
	289	+	18
	290	+	19
	291	+	20
	292	+	21
	293	+	22
	294	+	23
	295	+	24
183	296
184	297		(4) secures payment under a written instrument of
185	298		indebtedness modified, amended or restated from
186	299		or after the effective date of this act April 19,
187	300		2010, which modification, amendment or
188	301		restatement extends the stated maturity thereof
189	302		which was in effect at the effective date of this
190	303		act on April 19, 2010, or
191		-
192	304		(5) is not validly perfected with a first priority
193	305		against the claims of all persons under
194	306		applicable law other than persons holding a
195	307		statutory or regulatory lie n as to which first
196	308		priority is granted by statute or regulation, or
197		-
198	309		b. a validly perfected and enforceable lien created by
199	310		statute or by rule or regulation of a governmental
200	311		agency for storage or transportation charges,
201	312		including terminal charges, tariffs , demurrage,
202	313		insurance, labor or other charges, owed by a first
203	314		purchaser in relation to oil or gas originally
204	315		purchased under an agreement to sell; provided,
205	316		however, a permitted lien does not include any such
206	317		lien:
207		-
208	318		(1) which is in favor of an affiliate o f a first
209	319		purchaser unless such lien is authorized by the
	320	+
	321	+	SB632 HFLR Page 7
	322	+	BOLD FACE denotes Com mittee Amendments. 1
	323	+	2
	324	+	3
	325	+	4
	326	+	5
	327	+	6
	328	+	7
	329	+	8
	330	+	9
	331	+	10
	332	+	11
	333	+	12
	334	+	13
	335	+	14
	336	+	15
	337	+	16
	338	+	17
	339	+	18
	340	+	19
	341	+	20
	342	+	21
	343	+	22
	344	+	23
	345	+	24
	346	+
210	347		statute, rule or regulation creating such lien,
211	348		or
212		-
213	349		(2) which is for charges in excess of ninety (90)
214	350		days from the time the first purchaser delivers
215	351		such oil or gas for such storage or
216	352		transportation;
217		-
218	353		12. “Person” means any individual, executor, administrator,
219	354		estate, agent, trust, trustee, institution, receiver, business
220	355		trust, firm, corporation, partnership, limited liability company,
221	356		cooperative, joint venture, governmental entity or agency,
222	357		association or any other group or combination acting as a unit;
223		-
224		-	ENR. S. B. NO. 632 Page 6
225		-
226	358		13. “Pooling order” means an order issued by the Corporation
227	359		Commission that requires the owners of the right to drill for oil or
228	360		gas in a drilling and spacing unit to pool their interests for th e
229	361		development of such drilling and spacing unit;
230		-
231	362		14. “Proceeds” means any of the following when paid or to be
232	363		paid in consideration of, or as a consequence of, the sale of oil or
233	364		gas under an agreement to sell: oil or gas on or after severance;
234	365		inventory of raw, refined or manufactured oil or gas after
235	366		severance; rights to or products of any of the foregoing; cash
236	367		proceeds; accounts; chattel paper; instruments; documents; or
237	368		payment intangibles with respect to any of the foregoing;
238	369
	370	+	SB632 HFLR Page 8
	371	+	BOLD FACE denotes Com mittee Amendments. 1
	372	+	2
	373	+	3
	374	+	4
	375	+	5
	376	+	6
	377	+	7
	378	+	8
	379	+	9
	380	+	10
	381	+	11
	382	+	12
	383	+	13
	384	+	14
	385	+	15
	386	+	16
	387	+	17
	388	+	18
	389	+	19
	390	+	20
	391	+	21
	392	+	22
	393	+	23
	394	+	24
	395	+
239	396		15. “Purchaser” means a person which is not an affiliate of a
240	397		first purchaser and which takes, receives or purchases oil or gas
241	398		from a first purchaser;
242		-
243	399		16. “Representative” means any person who is authorized, either
244	400		expressly or by implication, including, without limitation, a n
245	401		operator or a broker so authorized, to sell oil or gas on behalf of,
246	402		or for the benefit of, an interest owner under an agreement to sell
247	403		or to receive on behalf of an interest owner the consideration under
248	404		an agreement to sell;
249		-
250	405		17. “Sales price” means the proceeds a first purchaser agrees
251	406		to pay an interest owner or representative under an agreement to
252	407		sell;
253		-
254	408		18. “Security interest” means a security interest governed by
255	409		Article 9;
256		-
257	410		19. “Severance” means that point in time at which oil or gas is
258	411		reduced to possession at the mouth of the wellbore of an oil and gas
259	412		well;
260		-
261	413		20. “Transferor interest owner ” means an interest owner that
262	414		transfers or conveys oil and gas rights, in whole or in part; and
263		-
264	415		21. “Transferee interest owner ” means a person that acquires
265	416		oil and gas rights from a transferor interest owner.
266		-
267		-
268		-	ENR. S. B. NO. 632 Page 7
269	417		SECTION 2. AMENDATORY 52 O.S. 2011, Section 549.3, is
270	418		amended to read as follows:
271		-
272	419		Section 549.3.
273	420
	421	+	SB632 HFLR Page 9
	422	+	BOLD FACE denotes Com mittee Amendments. 1
	423	+	2
	424	+	3
	425	+	4
	426	+	5
	427	+	6
	428	+	7
	429	+	8
	430	+	9
	431	+	10
	432	+	11
	433	+	12
	434	+	13
	435	+	14
	436	+	15
	437	+	16
	438	+	17
	439	+	18
	440	+	19
	441	+	20
	442	+	21
	443	+	22
	444	+	23
	445	+	24
	446	+
274	447		NATURE, EXTENT AND DURATION OF OIL AND GAS LIEN
275		-
276	448		A. To secure the obligations of a first purchaser to pay the
277	449		sales price, and to secure the obligation of any person to pay any
278	450		proceeds, as defined in Section 549.2 of this title , for the
279	451		acquisition of oil and gas rights, each interest owner is hereby
280	452		granted an oil and gas lien to th e extent of the interest owner ’s
281	453		interest in oil and gas rights. The oil and gas lien granted by
282		-	this act the Oil and Gas ~~Owners~~’ Lien Act of 2010 is granted and
	454	+	this act the Oil and Gas Owner’ Lien Act of 2010 is granted and
283	455		shall exist as part of and incident to the ownership of oil and gas
284	456		rights.
285		-
286	457		B. An oil and gas lien:
287		-
288	458		1. Exists in and attaches immediately to all oil and gas on the
289	459		effective date of this act April 19, 2010;
290		-
291	460		2. Continues uninterrupted and without lapse in all oil and gas
292	461		upon and after severance; and
293		-
294	462		3. Continues uninterrupted and without lapse in and to all
295	463		proceeds.
296		-
297	464		C. An oil and gas lien exists until the interest owner or
298	465		representative first entitled to receive the sales price or any
299	466		proceeds, as defined in Section 549.2 of this title , for the
300	467		acquisition of oil and gas rights, has received the sales price or
301	468		any proceeds, as defined in Section 549.2 of this title , for the
302	469		acquisition of oil and gas rights . Notwithstanding the immediately
303	470		preceding sentence, as between an interest owner and a
	471	+
	472	+	SB632 HFLR Page 10
	473	+	BOLD FACE denotes Com mittee Amendments. 1
	474	+	2
	475	+	3
	476	+	4
	477	+	5
	478	+	6
	479	+	7
	480	+	8
	481	+	9
	482	+	10
	483	+	11
	484	+	12
	485	+	13
	486	+	14
	487	+	15
	488	+	16
	489	+	17
	490	+	18
	491	+	19
	492	+	20
	493	+	21
	494	+	22
	495	+	23
	496	+	24
	497	+
304	498		representative of an interest owner or any person claiming adversely
305	499		to such interest owner or representative, such interest owner ’s oil
306	500		and gas lien continues uninterrupted and without lapse in proceeds
307	501		in the possession or control of a representative until the interest
308	502		owner on whose behalf such repres entative acts receives such
309	503		proceeds in full. When a first purchaser, in good faith, pays the
310	504		sales price to an interest owner or a representative otherwise
311		-
312		-	ENR. S. B. NO. 632 Page 8
313	505		apparently entitled to receive the sales price and the first
314	506		purchaser is without actual knowledge that such interest owner or
315	507		representative is not entitled to receive the sales price so paid,
316	508		then such first purchaser takes free of the oil and gas lien
317	509		otherwise applicable to the oil or gas for which such payment was
318	510		made. Notwithstanding the immedi ately preceding sentence, the oil
319	511		and gas lien will continue uninterrupted in the proceeds paid to or
320	512		otherwise due the interest owner or representative.
321		-
322	513		D. The validity of an oil and gas lien shall not be dependent
323	514		on possession of the oil or gas by an i nterest owner or
324	515		representative. No oil and gas lien shall become or be deemed to be
325	516		void or expired by reason of a change or transfer of the actual or
326	517		constructive possession of or title to the oil or gas from the
327	518		interest owner or representative to a fi rst purchaser or purchaser.
328		-
329	519		E. On the conveyance or transfer of any oil and gas rights by a
330	520		transferor interest owner, the oil and gas lien vested in the
331	521		transferor interest owner immediately before the conveyance or
	522	+
	523	+	SB632 HFLR Page 11
	524	+	BOLD FACE denotes Com mittee Amendments. 1
	525	+	2
	526	+	3
	527	+	4
	528	+	5
	529	+	6
	530	+	7
	531	+	8
	532	+	9
	533	+	10
	534	+	11
	535	+	12
	536	+	13
	537	+	14
	538	+	15
	539	+	16
	540	+	17
	541	+	18
	542	+	19
	543	+	20
	544	+	21
	545	+	22
	546	+	23
	547	+	24
	548	+
332	549		transfer shall remain with the transfe ror interest owner to the
333	550		extent of any oil and gas rights retained by the transferor interest
334	551		owner.
335		-
336	552		F. On the conveyance or transfer of any oil and gas rights by a
337	553		transferor interest owner, the oil and gas lien vested in the
338	554		transferor interest owner i mmediately before the conveyance or
339	555		transfer shall be transferred to and attach automatically to the oil
340	556		and gas rights acquired by the transferee interest owner
341	557		uninterrupted and without lapse and as part of and incident to the
342	558		oil and gas rights so trans ferred or conveyed.
343		-
344	559		SECTION 3. This act shall become effective November 1, 2021.
345	560
346		-
347		-	ENR. S. B. NO. 632 Page 9
348		-	Passed the Senate the 10th day of March, 2021.
349		-
350		-
351		-
352		-	Presiding Officer of the Senate
353		-
354		-
355		-	Passed the House of Representatives the 13th day of April, 2021.
356		-
357		-
358		-
359		-	Presiding Officer of the House
360		-	of Representatives
361		-
362		-	OFFICE OF THE GOVERNOR
363		-	Received by the Office of the Governor this _______ _____________
364		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
365		-	By: _______________________________ __
366		-	Approved by the Governo r of the State of Oklahoma this _____ ____
367		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
368		-
369		-	_________________________________
370		-	Governor of the State of Oklahoma
371		-
372		-
373		-	OFFICE OF THE SECRETARY OF STATE
374		-	Received by the Office of the Secretary of State this _______ ___
375		-	day of __________________, 20 _______, at _______ o'clock _______ M.
376		-	By: _______________________________ __
	561	+	COMMITTEE REPORT BY: COMMITTEE ON ENERGY AND NATURAL RESOURCES,
	562	+	dated 04/01/2021 - DO PASS.