NATURAL RESOURCES CODE

TITLE 1. GENERAL PROVISIONS

CHAPTER 1. GENERAL PROVISIONS

Sec. 1.001. PURPOSE OF CODE. (

a) This code is enacted as a part of the state's continuing statutory revision program, begun by the Texas Legislative Council in 1963 as directed by the legislature in

Chapter 448, Acts of the 58th Legislature, Regular Session, 1963 (Article 5429b-1, Vernon's Texas Civil Statutes). The program contemplates a topic-by-topic revision of the state's general and permanent statute law without substantive change.

(

b) Consistent with the objectives of the statutory revision program, the purpose of this code is to make the general and permanent natural resources law more accessible and understandable by:

(1) rearranging the statutes into a more logical order;

(2) employing a format and numbering system designed to facilitate citation of the law and to accommodate future expansion of the law;

(3) eliminating repealed, duplicative, unconstitutional, expired, executed, and other ineffective provisions; and

Acts 1977, 65th Leg., p. 2347, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 1.002. CONSTRUCTION OF CODE. The Code Construction Act (Chapter 311 , Government Code) applies to the construction of each provision in this code, except as otherwise expressly provided by this code.

Acts 1977, 65th Leg., p. 2347, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977. Amended by Acts 1985, 69th Leg., ch. 479,

Sec. 71, eff. Sept. 1, 1985.

Sec. 1.003. PREEMPTION. Unless expressly authorized by another statute, a municipality or county may not adopt, enforce, or maintain an ordinance, order, or rule regulating conduct in a field of regulation that is occupied by a provision of this code. An ordinance, order, or rule that violates this

section is void, unenforceable, and inconsistent with this code.

Added by Acts 2023, 88th Leg., R.S., Ch. 899 (H.B. 2127 ),

Sec. 13, eff. September 1, 2023.

NATURAL RESOURCES CODE

TITLE 3. OIL AND GAS

SUBTITLE C. POOLING AND COOPERATIVE AGREEMENTS

CHAPTER 101. COOPERATIVE DEVELOPMENT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 101.001. DEFINITION. In this chapter, "commission" means the Railroad Commission of Texas.

Acts 1977, 65th Leg., p. 2566, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 101.002. EXISTING AGREEMENT RIGHTS. None of the provisions in this

chapter restrict any of the rights that a person now may have to make and enter into unitization and pooling agreements.

Acts 1977, 65th Leg., p. 2566, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 101.003. APPLICABILITY. None of the provisions in this

chapter impair the power of the commission to prevent waste under the oil and gas conservation laws of the state except as provided in

Section 101.004 or repeal, modify, or impair any of the provisions of Sections 85.002 through 85.003, 85.041 through 85.055 , 85.056 through 85.064 , 85.125 , 85.201 through 85.207 , 85.241 through 85.243 , 85.249 through 85.252 , or 85.381 through 85.385 , Subchapter J of

Chapter 85 , or Subchapter P of

Chapter 91 , relating to oil and gas conservation.

Acts 1977, 65th Leg., p. 2566, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 816 (S.B. 1670 ),

Sec. 7, eff. September 1, 2007.

Sec. 101.004. CONFLICT WITH ANTITRUST ACTS. (

a) Agreements and operations under agreements which are in accordance with the provisions in this chapter, being necessary to prevent waste and conserve the natural resources of this state, shall not be construed to be in violation of the provisions of

Chapter 15 , Business & Commerce Code, as amended.

(

b) If a court finds a conflict between the provisions in this

chapter and

Chapter 15 , Business & Commerce Code, as amended, the provisions in this

chapter are intended as a reasonable exception to that law, necessary for the public interests stated in Subsection (

a) of this section.

(

c) If a court finds that a conflict exists between the provisions in this

chapter and

Chapter 15 , Business & Commerce Code, as amended, and finds that the provisions in this

chapter are not a reasonable exception to said

Chapter 15, it is the intent of the legislature that the provisions in this chapter, or any conflicting portion of them, shall be declared invalid rather than declaring

Chapter 15 , Business & Commerce Code, as amended, or any portion of it, invalid.

Acts 1977, 65th Leg., p. 2567, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

SUBCHAPTER B. COOPERATIVE AGREEMENTS IN SECONDARY RECOVERY OPERATIONS

Sec. 101.011. AUTHORIZED AGREEMENTS FOR SEPARATELY OWNED PROPERTIES. Subject to the approval of the commission, as provided in this chapter, persons owning or controlling production, leases, royalties, or other interests in separate property in the same oil field, gas field, or oil and gas field may voluntarily enter into and perform agreements for either or both of the following purposes:

(1) to establish pooled units, necessary to effect secondary recovery operations for oil or gas, including those known as cycling, recycling, repressuring, water flooding, and pressure maintenance and to establish and operate cooperative facilities necessary for the secondary recovery operations;

(2) to establish pooled units and cooperative facilities necessary for the conservation and use of gas, including those for extracting and separating the hydrocarbons from the natural gas or casinghead gas and returning the dry gas to a formation underlying any land or leases committed to the agreement.

Acts 1977, 65th Leg., p. 2567, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 101.012. PERSONS BOUND BY AGREEMENTS. Agreements for pooled units and cooperative facilities do not bind a landowner, royalty owner, lessor, lessee, overriding royalty owner, or any other person who does not execute them. The agreements bind only the persons who execute them, their heirs, successors, assigns, and legal representatives. No person shall be compelled or required to enter into such an agreement.

Acts 1977, 65th Leg., p. 2567, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 101.013. COMMISSION APPROVAL. (

a) Agreements for pooled units and cooperative facilities are not legal or effective until the commission finds, after application, notice, and hearing:

(1) that the agreement is necessary to accomplish the purposes specified in

Section 101.011 of this code;

(2) that it is in the interest of the public welfare as being reasonably necessary to prevent waste and to promote the conservation of oil or gas or both;

(3) that the rights of the owners of all the interests in the field, whether signers of the unit agreement or not, would be protected under its operation;

(4) that the estimated additional cost, if any, of conducting the operation will not exceed the value of additional oil and gas so recovered, by or on behalf of the several persons affected, including royalty owners, owners of overriding royalties, oil and gas payments, carried interests, lien claimants, and others as well as the lessees;

(5) that other available or existing methods or facilities for secondary recovery operations or for the conservation and utilization of gas in the particular area or field concerned or for both are inadequate for the purposes; and

(6) that the area covered by the unit agreement contains only that part of the field that has reasonably been defined by development, and that the owners of interests in the oil and gas under each tract of land in the area reasonably defined by development are given an opportunity to enter into the unit on the same yardstick basis as the owners of interests in the oil and gas under the other tracts in the unit.

(

b) A finding by the commission that the area described in the unit agreement is insufficient or covers more acreage than is necessary to accomplish the purposes of this

chapter is grounds for the disapproval of the agreement.

Acts 1977, 65th Leg., p. 2568, ch. 871, art. I,

Sec. 1, eff. Sept. 1, 1977.

Sec. 101.