Texas Administrative Code › Title 31 - NATURAL RESOURCES AND CONSERVATION › Part 5 - BOARDS FOR LEASE OF STATE-OWNED LANDS › Chapter 201 - OPERATIONS OF THE TEXAS PARKS AND WILDLIFE DEPARTMENT AND TEXAS DEPARTMENT OF CRIMINAL JUSTICE BOARD FOR LEASE › Section 201.6 - Lessee Responsibility

Current through Reg. 49, No. 28; July 12, 2024
(a) Applicable
				Laws. All drilling, producing, gathering, transporting, processing and other
				operations on state lands shall be subject to applicable state and federal
				laws.
(b) Conflict between this
				chapter and other rules and statutes. Operations on state lands are subject to
				all valid applicable state and federal regulatory authorities. This chapter
				supplements the regulatory powers of such authorities.
(c) General policy. These rules are not
				intended to unlawfully impair any existing contract.
(d) Exceptions to this chapter. A Board for
				Lease (Board) may if authorized by law and upon proper written request, grant
				exceptions to the provisions of this chapter if the Board deems the exceptions
				to be in the best interest of the state. No such exception shall be effective
				until a written request by the lessee and a written explanation, approved by
				the Board and signed by the commissioner, as chairman of the Board, is placed
				in the appropriate mineral file or other General Land Office file.
(e) Compliance. Lessee shall comply with the
				provisions of the lease. Nothing in this chapter shall be construed as
				relieving a lessee of this duty or as impairing any remedies available to the
				state. If a lessee or operator fails to comply with this chapter, the Board may
				seek any remedy allowed by law, including forfeiture of the lease. Lessee shall
				be liable for the damages caused by such failure and any costs and expenses
				incurred while enforcing this chapter and cleaning areas affected by any
				pollution or discharged waste. A lessee is also responsible for the actions or
				omissions of its operator as well as for the actions or omissions of lessee's
				employees, agents, servants, contractors, subcontractors, trustees, receivers,
				and any other agent in control of any or all of the leasehold
				interest.
(f) Identification. All
				well locations and other structures shall be marked so as to identify the state
				tract number, well number, and the company operating the lease. Additionally,
				any well drilled on property leased under this chapter must be identified as a
				state well in Railroad Commission records by using "state" as the first word in
				its designated Railroad Commission name.
(g) Inspections. The commissioner of the GLO,
				the attorney general, the governor, and their representatives, shall at all
				times have access to the premises upon which wells are being drilled or
				produced for oil, gas, or other minerals to make inspections of all drilling,
				producing, gathering, and processing operations, or for any other reason deemed
				necessary.
(h) Records. The General
				Land Office may from time to time require any records not otherwise required
				relating to any aspect of lease operations and accounting. Such records shall
				be provided to the General Land Office within 30 days of the agency's request
				for their production.
(i)
				Commingling production. Lessee must obtain written permission from GLO staff
				before surface commingling a state lease tract or state pooled unit production
				with private lease production or before surface commingling oil and/or gas from
				two separate state leases and/or pooled state units. Send commingling requests
				to the Texas General Land Office; Attention: Minerals Leasing; 1700 North
				Congress; Austin, Texas 78701-1495. The requirement to obtain GLO approval
				applies to all commingle exception request applications including new permits
				and amendments to existing permits.
(j) Surface Use and Hole Abandonment. Any
				hole or holes drilled by any exploration party under the terms of a lease
				issued by the state under this chapter shall be drilled in such manner as to
				interfere as little as possible with the current use of the surface. Upon the
				abandonment of such holes, all of the rigging and material shall be removed,
				and the surface where said hole was drilled shall be restored to its former
				condition as nearly as possible. Upon abandonment of a well site, all wells
				shall be plugged and all structures removed in compliance with Railroad
				Commission and United States Army Corps of Engineer regulations. All fills for
				roads and drill sites shall be removed if requested by the
				commissioner.
(k) Degree of care.
				Lessee shall use the highest degree of care in conducting operations on tracts
				leased under this chapter and shall take all proper safeguards to prevent the
				discharge of any pollutant, including solid waste, and of any hazardous
				substances. To satisfy these requirements, lessee, at a minimum, must conduct
				operations as a reasonably prudent operator using standard industry practices
				and procedures, must satisfy express lease provisions, and must comply with all
				valid, applicable federal and state regulations.
(l) Reporting Pollution. In the event that
				any pollution, whether cumulative or the result of an isolated event, occurring
				on a leased tract reaches a level at which it becomes a violation of state
				and/or federal law, notice of all relevant facts related to such pollution
				shall be filed by lessee with the General Land Office within 10 business days
				of lessee's receipt of notification of the violation from the appropriate state
				and/or federal authorities.
(m)
				Separator required. All wells producing liquids must be produced through oil
				and gas separators of ample capacity and in good working order. All separators
				shall be of conventional type (or other equipment at least as efficient) to
				provide for separation and metering of all lease or pooled unit gas and liquid
				hydrocarbon production before surface commingling with the production from any
				other lease and/or pooled unit. However, upon review and approval by GLO staff,
				a waiver granting exception to this requirement may be provided so that full
				well stream gas production can be metered (i.e. wet gas metering). The lessee
				must obtain written permission from GLO staff before installation of full well
				stream/wet gas meters in lieu of setting a separator.