Morales Bill’s $100,000 Disposal Fee Skips Existing Operators

The text as introduced · 1,152 words

By: Morales of Maverick
H.B. No. 4891

A BILL TO BE ENTITLED

AN ACT

relating to the regulation by the Railroad Commission of Texas of

certain commercial facilities that dispose of oil and gas waste;

imposing a fee.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 91.109, Natural Resources Code, is

amended by amending Subsections (a) and (b) and adding Subsections

(a-1), (a-2), and (a-3) to read as follows:

(a) In this section, "commercial disposal facility" has the

meaning assigned by Section 91.116.

(a-1) A person applying for or acting under a commission

permit to operate a commercial disposal facility shall maintain a

performance bond or other form of financial security conditioned

that the permittee will operate and close the facility in

accordance with state law, commission rules, and the permit to

operate the facility.

(a-2) A person applying for or acting under a commission

permit to store, handle, treat, reclaim, or dispose of oil and gas

waste , other than a permit to operate a commercial disposal

facility, may be required by the commission to maintain a

performance bond or other form of financial security conditioned

that the permittee will operate and close the storage, handling,

treatment, reclamation, or disposal site in accordance with state

law, commission rules, and the permit to operate the site. However,

this section does not authorize the commission to require a bond or

other form of financial security for saltwater disposal pits,

emergency saltwater storage pits (including blow-down pits),

collecting pits, or skimming pits provided that such pits are used

in conjunction with the operation of an individual oil or gas lease.

(a-3) Subject to the refund provisions of Section 91.1091,

proceeds from any bond or other form of financial security required

by this section shall be placed in the oil and gas regulation and

cleanup fund. Each bond or other form of financial security shall

be renewed and continued in effect until the conditions have been

met or release is authorized by the commission.

(b) In addition to the financial security requirements of

Subsections (a-1) and (a-2) [ Subsection (a) ], a person required to

file a bond, letter of credit, or cash deposit under Section 91.103

who is involved in activities other than the ownership or operation

of wells must file the bond, letter of credit, or cash deposit at

the time of filing or renewing an organization report required by

Section 91.142 according to the following schedule:

(1) no bond, letter of credit, or cash deposit if the

person is a:

(A) local distribution company;

(B) gas marketer;

(C) crude oil nominator;

(D) first purchaser;

(E) well servicing company;

(F) survey company;

(G) salt water hauler;

(H) gas nominator;

(I) gas purchaser; or

(J) well plugger; or

(2) a bond, letter of credit, or cash deposit in an

amount not to exceed $25,000 if the person is involved in an

activity that is not associated with the ownership or operation of

wells and is not listed in Subdivision (1).

SECTION 2. The heading to Section 91.116, Natural Resources

Code, is amended to read as follows:

Sec. 91.116. NOTICE OF COMMERCIAL [ SURFACE ] DISPOSAL

FACILITY PERMIT APPLICATION.

SECTION 3. Sections 91.116(a) and (b), Natural Resources

Code, are amended to read as follows:

(a) In this section, "commercial [ surface ] disposal

facility" means a facility whose primary business purpose is to

provide, for compensation :

(1) [ , ] surface disposal of oil field fluids or oil and

gas wastes, including land application for treatment and disposal ;

or

(2) the injection of drill cuttings, drilling mud, or

other solid or semi-solid oil using a Commercial oil and gas waste

stationary treatment facilities .

(b) A person who files an application for a permit for a

commercial [ surface ] disposal facility shall publish notice of the

application in accordance with this section.

SECTION 4. The heading to Section 91.117, Natural Resources

Code, is amended to read as follows:

Sec. 91.117. PUBLIC INFORMATION HEARING ON APPLICATION FOR

COMMERCIAL [ SURFACE ] DISPOSAL FACILITY PERMIT.

SECTION 5. Sections 91.117(a) and (b), Natural Resources

Code, are amended to read as follows:

(a) In this section, "commercial [ surface ] disposal

facility" has the meaning assigned by Section 91.116.

(b) The commission may hold a public meeting to receive

public comment on an application for a commercial [ surface ]

disposal facility if the commission determines a public meeting is

in the public interest.

SECTION 6. Subchapter D, Chapter 91, Natural Resources

Code, is amended by adding Sections 91.118 and 91.119 to read as

follows:

Sec. 91.118. DEMONSTRATION OF NECESSITY REQUIRED FOR

CERTAIN COMMERCIAL DISPOSAL FACILITY PERMITS. (a) In this

section, "commercial disposal facility" has the meaning assigned by

Section 91.116.

(b) The commission may not approve an application for a

permit for a commercial disposal facility unless the person

applying for the permit demonstrates the necessity for an

additional commercial disposal facility in the primary market area,

as established by the commission, in which the facility will be

located.

(c) To demonstrate the necessity for an additional

commercial disposal facility, the applicant must include with the

applicant's permit application for the commercial disposal

facility:

(1) a map and list of all permitted commercial

disposal facilities located within a 30-mile radius of the location

of the site for which the applicant is applying for the permit; and

(2) the number of oil and gas wells located within a

30-mile radius of the location of the site for which the applicant

is applying for a permit in the year preceding the date on which the

applicant submitted the application for the permit.

(d) In addition to the information required under

Subsection (c), the applicant may submit to the commission other

relevant economic, environmental, and feasibility information to

demonstrate the necessity of the commercial disposal facility.

Sec. 91.119. APPLICATION FEE FOR CERTAIN COMMERCIAL

DISPOSAL FACILITIES. (a) In this section, "commercial disposal

facility" has the meaning assigned by Section 91.116.

(b) With each application for a commercial disposal

facility permit, the applicant shall submit to the commission a

nonrefundable fee of $100,000.

(c) The application fee under Subsection (b) is not

applicable to commercial disposal facility permit holders seeking

the renewal or modification of a permit in effect before September

1, 2025.

SECTION 7. Section 27.073(a), Water Code, is amended to

read as follows:

(a) A person to whom an injection well permit is issued ,

other than a permit for a well subject to Section 91.109(a-1),

Natural Resources Code, may be required by the commission or

railroad commission to maintain a performance bond or other form of

financial security to ensure that:

(1) an abandoned injection well is properly plugged;

or

(2) funds are available for plugging, postinjection

site care, and closure of an anthropogenic carbon dioxide injection

well subject to Subchapter C-1.

SECTION 8. This Act takes effect September 1, 2025.