Legislative Affairs March 2011

LEGISLATIVE AFFAIRS COMMITTEE REPORT

The following legislative report is submitted by Blaine Dyer and Ryan Cole, Co-Chairs of the OCAPL Legislative Affairs Committee. If you would like to discuss how a particular bill might impact your business and operations, you may contact Blaine (Blaine@thedyerlawfirm.com; 405.831.1145) or Ryan (rcole@maproyalty.com) at your convenience.

            If you are interested in a specific bill indicated below, you may obtain a copy of the full text of the bill by calling the Senate Bill Distribution, Room 310 at the State Capitol (405-521-5514). Copies may also be downloaded from the Legislative Services Bureau web site http://www.lsb.state.ok.us.

            If you are in favor of, or opposed to, any specific legislation, call or write your State Representative and/or your Senator. Few people take the time to contact members of the Legislature, and the magnitude of a simple letter or telephone call can have a real effect on pending legislation.

            The bills listed below represent a selection deemed to be particularly relevant to the oil and gas industry. Because the range of bills that impact oil and gas is very broad, it is not possible to provide a full account of every bill. If there is a particular bill you would like OCAPL to focus more closely upon, please notify the OCAPL legislative committee and we will make efforts to make sure our members remain satisfied.

Respectfully,

Blaine M. Dyer, Esq. ~ Legislative Affairs Committee

 

HB1823: This bill would provide an exception for horizontal units from certain well spacing and drilling unit limits; establishing a maximum size of a well spacing and drilling unit for certain horizontal units. In particular the bill reads, “for a horizontal unit that will contain at least one lateral exceeding five thousand (5,000) feet in length, the acreage to be embraced within each unit shall not exceed one thousand two hundred eighty (1,280) acres for a gas well plus ten percent (10%) tolerance.

  • Current Status – Referred to the House Energy & Utility Regulation Committee.

 

HB1909: Due to advancements in horizontal drilling techniques for wells drilled and completed in shale formations in Oklahoma, this bill calls for modification of the historical statutory spacing scheme found in Section 87.1 and Sections 287.1 through 287.15 of Title 52 of the Oklahoma Statutes, in particular with laterals exceeding five thousand two hundred eighty (5,280) feet in length.

  • Current StatusThe House Energy & Utility Regulation Committee recommended DO PASS by a vote of 24 to 0 on 3/2/2011.

SB242: This bill proposes a new law dealing with spacing requirements for a horizontal well, allowing for the unitization of multiple governmental sections into a single unit for the uniform development of the shale formation through the use of extended lateral horizontal wells.

  • Update – Amended. The proposed amendment creates the 2011 Shale Reservoir Development Act and goes into great detail setting out new laws which would govern multi-unit horizontal wells. Please see proposed amendment for further details.
  • Current Status – The Energy Committee recommended DO PASS as amended.

 

SB660: This bill addresses the increasing areas of conflict between the long-standing oil and gas production and exploration industry and the newly developing wind energy industries; asking the Oklahoma Corporation Commission to study the legal and equitable relationships between the owners of surface rights incident to wind energy and the owners of mineral interests incident to the right to explore for and produce oil and gas before conflicts arise leading to expensive legal battles and unnecessary delays in production.

  • Current Status – Referred to Committee for further authorship on 2/16/2011.

 

SB113: This bill, which relates to permitting and regulation of seismic exploration, would require surety to be filed with the Secretary of State in certain amounts prior to the issuance of a permit; requiring the Oklahoma Corporation Commission to determine the amount of the bond and duration of the certain surety.

  • Current Status – Referred to Energy Committee for Second Reading on 2/8/2011.

 

SB641: This bill, which relates to the Production Revenue Standards Act, modifies the amount of certain interest penalties and authorizes certain persons to seek court determinations.

  • Current Status – Referred to Energy Committee for Second Reading on 2/8/2011.

 

SB889: This bill would create a rebuttable presumption that property was obtained by undue influence in any situation where a person with real or apparent authority over an elderly or disabled person transfers the elderly or disabled person’s real or personal property for less than full consideration.

  • Current Status - Referred to Judiciary Committee for Second Reading on 2/14/2011.