Texas Senate Bill SCR72

Texas 2009 - 81st Regular

• Refer: 5/13/09
• Report Pass: 5/14/09
• Refer: 5/25/09
• Report Pass: 5/28/09
• Introduced: 5/28/09
• Enrolled: 6/1/09
• Passed: 6/19/09

Caption

Granting Gulf Energy Exploration Corporation permission to sue the Railroad Commission of Texas.

Impact

Upon granting this permission, SCR72 may lead to significant legal repercussions for the state and the Railroad Commission, including financial liabilities. Gulf Energy Exploration Corp. is able to seek damages up to $2,500,000 to compensate for their incurred costs and losses due to the state’s actions. This could alter the procedural landscape regarding how the Railroad Commission manages orphaned wells and engages with energy companies, potentially leading to stricter oversight or clearer guidelines to prevent such disputes in the future.

Summary

SCR72 is a concurrent resolution that grants Gulf Energy Exploration Corporation permission to sue the State of Texas and the Railroad Commission of Texas after the wrongful plugging of an orphaned well, State Tract 708-S No. 5. The resolution outlines the circumstances leading to the legal action, detailing how the Railroad Commission allegedly plugged the well without due cause, despite prior agreements to allow for workover operations on the well, which is crucial for economic viability in the Sherman Field area.

Contention

The resolution touches upon notable points of contention regarding the management of oil and gas resources in Texas, as well as the accountability of state agencies. There may be concerns from environmental advocates regarding the implications of having orphaned wells plugged and the risks associated with future drilling operations in an attempt to restore the wells. Moreover, the financial burden borne by Gulf Energy Exploration Corp. raises questions about the responsibilities of the state when it comes to managing public resources and protecting economic interests of small to mid-sized companies in the energy sector.