Relating to the information required to be provided by a payor of proceeds from the sale of oil or gas from an oil or gas well to a payee on the request by the payee.
Impact
The implications of SB402 are significant for transparency in the oil and gas sector. By mandating that payors furnish detailed calculations and information upon request, it aims to ensure that payees (often landowners or mineral rights holders) are fully informed of how their shares of production proceeds are determined. This increased transparency could enhance trust between payees and payors, potentially leading to more equitable financial arrangements in the resource sector.
Summary
Senate Bill 402 is an amendment to the Texas Natural Resources Code, specifically addressing the obligations of payors in the oil and gas industry regarding the information they must provide to payees. The bill establishes that if a payee requests information concerning the calculation of their fractional or decimal interest in the production from a well, the payor is required to provide this information. This includes the formula used for the calculations, the data used to determine the interest, and details about any pooling or unitization agreements that may affect that interest.
Contention
While SB402 is primarily focused on improving the informational transparency of transactions in the oil and gas industry, there may be potential points of contention regarding how this could impact the operational processes of payors. Some stakeholders might express concerns about the administrative burden that could arise from additional reporting requirements. There may also be discussions about the readiness of payors to comply with these demands and the possible need for revisions to existing contracts to align with the new requirements.
Identical
Relating to the information required to be provided by a payor of proceeds from the sale of oil or gas from an oil or gas well to a payee on the request by the payee.
Relating to the reduction and plugging of orphaned oil and gas wells; providing for the imposition of a fee and an exemption from certain taxes and fees.
Relating to the reduction and plugging of orphaned oil and gas wells; providing for the imposition of a fee and an exemption from certain taxes and fees.
Relating to an exemption from the severance tax for gas produced from certain wells that is consumed near the well and would otherwise have been lawfully vented or flared.