HB 262 — The regulation by the Railroad Commission of Texas of ce

90R141 ANG-F By: Morales of Maverick H.B. No. 262 relating to the regulation by the Railroad Commission of Texas of certain commercial facilities that dispose of oil and gas waste; imposing a fee.

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, "stationary commercial surface 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 stationary commercial surface disposal facility for oil and gas waste 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 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 STATIONARY 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, " stationary 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 surface disposal of drill cuttings, drilling mud, or other solid or semi-solid oil using a stationary commercial oil and gas treatment facility . (b) A person who files an application for a permit for a stationary 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 STATIONARY 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, " stationary 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 stationary commercial surface disposal facility if the commission determines a public meeting is in the public interest.

SECTION 6. The heading to Section 91.118, Natural Resources Code, is amended to read as follows: Sec. 91.118. TERM AND RENEWAL OF STATIONARY COMMERCIAL SURFACE DISPOSAL FACILITY PERMIT.

SECTION 7. Sections 91.118(a), (b), (c), and (d), Natural Resources Code, are amended to read as follows: (a) In this section, " stationary commercial surface disposal facility" has the meaning assigned by Section 91.116. (b) Unless otherwise provided by law, a permit for a stationary commercial surface disposal facility: (1) is valid for a term of not more than 10 years; and (2) carries with it the right to apply for successive renewal on expiration for areas within the boundaries of the existing permit. (c) In determining the proper term of a new permit for a stationary commercial surface disposal facility, the commission may consider the applicant's history of compliance with commission rules and permits issued by the commission for similar waste management facilities based on previous inspections, quarterly reports, and other relevant evidence documented by the commission. (d) In determining the proper term of an amended or renewal permit for a stationary commercial surface disposal facility, the commission may consider the applicant's history of compliance with commission rules and permits issued by the commission for the subject facility or similar waste management facilities based on previous inspections, quarterly reports, and other relevant evidence documented by the commission.

SECTION 8. Subchapter D, Chapter 91, Natural Resources Code, is amended by adding Sections 91.119 and 91.120 to read as follows: Sec. 91.119. DEMONSTRATION OF NECESSITY REQUIRED FOR CERTAIN STATIONARY COMMERCIAL SURFACE DISPOSAL FACILITY PERMITS. (a) In this section, "stationary commercial surface disposal facility" has the meaning assigned by Section 91.116. (b) The commission may not approve an application for a permit for a stationary commercial surface disposal facility unless the person applying for the permit demonstrates the necessity for an additional stationary commercial surface 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 stationary commercial surface disposal facility, the applicant must include with the applicant's permit application for the stationary commercial surface disposal facility: (1) a map and list of all permitted stationary commercial surface 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 shall submit to the commission other relevant economic, environmental, and feasibility information to demonstrate the necessity of the stationary commercial surface disposal facility. Sec. 91.120. APPLICATION FEE FOR CERTAIN STATIONARY COMMERCIAL SURFACE DISPOSAL FACILITIES. (a) In this section, "stationary commercial surface disposal facility" has the meaning assigned by Section 91.116. (b) With each application for a stationary commercial surface 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 stationary commercial surface disposal facility permit holders seeking the renewal or modification of a permit in effect before September 1, 2027.

SECTION 9. This Act takes effect September 1, 2027.