+Iarch 18, 1957.

.,, ,. Honorable .Richard Slack, Chairman Opinion No; WW-67 Oil and Gas Committee House ofRepresentatives~ ,,Re: To what extent and inwhat Austin,’ Texas way does Section 7ofH.B. 496 change.Article 6066c, Dear Mr. Slack: ‘I Revised Civil Statutes ?

In reply toyour letter ofMarch 5, 1957, which we quote in part as follows:

YWill you please ascertain towhat extent and in what wag Section 7ofthe proposed bill changes Article 

### 6066c,RWiS~d Civil Statu@%3.“.

we offer the following opinion:

Article 

### 6066c,V.C.S., provides that the Railroad Commission may approve agreements for the construction and operation ofcooperative facilities necessary for the conservation and utilization ofgas, including facilities for extracting and separating hydrocarbons from natural gas, or casinghead gas. This statute declared that,such,cooperative agreements are intended as a reasonable exception tothe Anti-Trust Acts.1

The Railroa~d Commission can approve agreements for the construction and operation ofcooperative facilities for the extraction of liquid hydrocarbons from gas and the separation of such liquid hydrocarbons into butanes, propanes, ethanes, distillate, condensate and natural gasoline without any additional processing ofany ofthem, and Article 6066~ specifically provides that no approval shall be given toagreements providing for cooperative marketing or +efiningN2 ofcrude petroleum, condensate, distillate or gas or any by-products thereof. 1Title **126,** Revised Civil **Statutes,** 1925, as amended; Chapter 3, Title 19, Penal Code of Texas, 1925, as amended. ” 2Article 6066~ provides in part “the extraction of liquid hydrocarbons from gas and the separation of such liquid hydrocarbons into butanes, propanes, ethanes, distillate, condensate and natural gasoline without any additional processing ofany ofthem shall not be considered to be refining.*Honorable Richard Slack, Page 2 (WW-67)

Section 7ofH.B. 496 is quoted as follows: “Sec. 7. Agreements made in the interest ofconservation of oil or gas, or both, or for the prevention ofwaste, between and among **owners** or operators, or both, owning separate holdings in the same field or pool, or in any area that appears from geologic or other date to be underlaid by a common accumulation of oil or,.ges,, or both, and agreements between and among such owners or operators, **or** both, and royalty, owners therein, for ,thepurpose of bringing **about** the development and operation ofthe field, pool or area, or any part thereof, as a unit, and for establishing ,andcarrying out a plan for the cooperative development and **operation** thereof, when such agreements are approved by the Commission. are hereby authorized and shall not be held or construed to violate any 

### ofthe statutes ofthis State relating totrusts, monopolies, or contracts and combinations in restraint oftrade.” The effect ofthe enactment ofSection 7of.H.B. 496would be to grant to agreements made and approved pursuant~ toH.B.. 496. immunity from the Anti-Trust laws of Texas.

In **our** opinion nothing in Section 7ofH.B. 496 repeals or affects Article 6066c.. SUMMARY

In.our opinion nothing inSection,7 ofH.B. 496 repeals oraffects Article 6066~.

HB:tiw APPROVED:, OPINION GOMMIT,TEE H. Grady Chandler, ahairman Very truly **yours,**

,WILL- WILSON Attorney General

**BY -**  Houghton Brownlee, Jr. Assistant