| 4 | 6 | | AN ACT |
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| 5 | 7 | | relating to the authority of the Railroad Commission of Texas to |
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| 6 | 8 | | contract for the treatment of and sell drill cuttings. |
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| 7 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 8 | 10 | | SECTION 1. The heading to Section 91.115, Natural Resources |
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| 9 | 11 | | Code, is amended to read as follows: |
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| 10 | 12 | | Sec. 91.115. FIRST LIEN ON EQUIPMENT AND STORED |
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| 11 | 13 | | HYDROCARBONS OR DRILL CUTTINGS. |
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| 12 | 14 | | SECTION 2. Section 91.115, Natural Resources Code, is |
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| 13 | 15 | | amended by amending Subsections (a), (e), (f), and (g) and adding |
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| 14 | 16 | | Subsections (f-1) and (f-2) to read as follows: |
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| 15 | 17 | | (a) If a responsible person fails to clean up a site or |
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| 16 | 18 | | facility that has ceased oil and gas operations under the |
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| 17 | 19 | | commission's jurisdiction on or before the date the site or |
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| 18 | 20 | | facility is required to be cleaned up by law or by a rule adopted or |
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| 19 | 21 | | order issued by the commission, the state has a first lien, superior |
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| 20 | 22 | | to all preexisting and subsequent liens and security interests, on |
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| 21 | 23 | | the responsible person's interest in any hydrocarbons or drill |
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| 22 | 24 | | cuttings stored at the site or facility and in any equipment that |
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| 23 | 25 | | is: |
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| 24 | 26 | | (1) located at the site or facility; and |
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| 25 | 27 | | (2) used by the responsible person in connection with |
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| 26 | 28 | | the activity that generated the pollution. |
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| 27 | 29 | | (e) The lien is extinguished as to any stored hydrocarbons |
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| 28 | 30 | | or drill cuttings or items of equipment that are lawfully removed by |
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| 29 | 31 | | any person other than the operator or a nonoperator according to a |
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| 30 | 32 | | lien, lease, judgment, written contract, or security agreement |
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| 31 | 33 | | before the commission enters into a cleanup contract. An item of |
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| 32 | 34 | | equipment may not be removed from an abandoned site or facility if |
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| 33 | 35 | | the removal will cause the release of a substance that may cause |
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| 34 | 36 | | pollution unless the substance is lawfully disposed of. |
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| 35 | 37 | | (f) Equipment or stored hydrocarbons or drill cuttings |
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| 36 | 38 | | subject to a lien under this section are presumed to have been |
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| 37 | 39 | | abandoned on the date the commission enters into a contract to clean |
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| 38 | 40 | | up the site or facility on which the equipment, [or] hydrocarbons, |
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| 39 | 41 | | or drill cuttings are located. |
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| 40 | 42 | | (f-1) The commission may dispose of the abandoned equipment |
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| 41 | 43 | | or stored hydrocarbons in accordance with the provisions of |
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| 42 | 44 | | Sections 89.085, 89.086, and 89.087 [of this code] for the |
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| 43 | 45 | | disposition of well-site equipment and hydrocarbons. |
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| 44 | 46 | | (f-2) The commission may dispose of the abandoned stored |
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| 45 | 47 | | drill cuttings by contracting with a person to treat the drill |
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| 46 | 48 | | cuttings at the site or facility for a subsequent beneficial use and |
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| 47 | 49 | | selling the treated drill cuttings at a public auction or a public |
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| 48 | 50 | | or private sale. Sections 89.085(c)-(i), 89.086, and 89.087 apply |
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| 49 | 51 | | to the disposition of drill cuttings under this subsection in the |
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| 50 | 52 | | same manner as those sections apply to the disposition of |
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| 51 | 53 | | hydrocarbons. |
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| 52 | 54 | | (g) In this section: |
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| 53 | 55 | | (1) "Drill cuttings" has the meaning assigned by |
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| 54 | 56 | | Section 123.001. |
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| 55 | 57 | | (2) "Responsible ["responsible] person" has the |
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| 56 | 58 | | meaning assigned by Section 91.113 [of this code]. |
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| 57 | 59 | | (3) "Treat" means to use a manufacturing, mechanical, |
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| 58 | 60 | | thermal, or chemical process other than sizing, shaping, diluting, |
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| 59 | 61 | | or sorting. |
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| 60 | 62 | | SECTION 3. This Act takes effect immediately if it receives |
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| 61 | 63 | | a vote of two-thirds of all the members elected to each house, as |
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| 62 | 64 | | provided by Section 39, Article III, Texas Constitution. If this |
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| 63 | 65 | | Act does not receive the vote necessary for immediate effect, this |
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| 64 | 66 | | Act takes effect September 1, 2021. |
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