Bill Text: TX HB2849 | 2011-2012 | 82nd Legislature | Introduced

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Bill Title: Relating to the rights of an owner of the surface estate in land in connection with mineral exploration and production operations; providing administrative and criminal penalties.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2011-03-17 - Referred to Energy Resources [HB2849 Detail]

Download: Texas-2011-HB2849-Introduced.html

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82R9891 SMH-F
By: Simpson H.B. No. 2849

A BILL TO BE ENTITLED
AN ACT
relating to the rights of an owner of the surface estate in land in
connection with mineral exploration and production operations;
providing administrative and criminal penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 3, Natural Resources Code, is
amended by adding Chapter 93 to read as follows:
CHAPTER 93. SURFACE OWNER PROTECTIONS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 93.001. CONSTRUCTION. This chapter shall be construed
liberally to protect the rights of surface owners in connection
with mineral exploration and production operations.
Sec. 93.002. DEFINITIONS. In this chapter:
(1) "Agricultural use" has the meaning assigned by
Section 23.51, Tax Code.
(2) "Commission" means the Railroad Commission of
Texas.
(3) "Mineral developer" means a person who acquires a
mineral estate or a mineral lease for the purpose of extracting or
using minerals from a tract of land for purposes other than
agricultural use.
(4) "Mineral estate" means an estate in or ownership
of all or part of the minerals underlying a tract of land.
(5) "Mineral exploration and production operations"
means the following activities to the extent they require entry on
the surface of a tract of land:
(A) mineral geophysical and seismographical
exploration activities; and
(B) mineral drilling, production, and completion
operations.
(6) "Streamside management zone" has the meaning
assigned by Section 23.9801, Tax Code.
(7) "Surface estate" means an estate in or ownership
of the surface of a tract of land.
(8) "Surface owner" means a person who holds record
title to the surface of a tract of land.
[Sections 93.003-93.050 reserved for expansion]
SUBCHAPTER B. NOTICE REQUIREMENTS
Sec. 93.051. NOTICE OF SURVEYING OR CONSTRUCTION. (a) A
mineral developer shall give each surface owner written notice that
the mineral developer plans to begin surveying the property or
constructing improvements on the property not later than the 14th
day before the date the surveying or construction begins.
(b) Notwithstanding Subsection (a), if the mineral
developer plans to begin surveying or construction work less than
14 days before the date the mineral lease terminates, the notice may
be given at any time before the surveying or construction work
begins.
(c) The notice must be given to each surface owner at the
surface owner's address as shown by the records of the county clerk
or county tax assessor-collector at the time the notice is given.
(d) The notice must:
(1) sufficiently describe the mineral exploration and
production operations on the land, the schedule for conducting the
operations, and the land to be affected by the operations to enable
the surface owner to evaluate the effect of the operations on the
surface owner's use of the land;
(2) include a description of the property to be
surveyed or a plat of the planned construction; and
(3) include a statement advising the surface owner of
the surface owner's rights under this chapter.
(e) If a mineral developer fails to give a surface owner
notice as provided by this section, the surface owner may seek any
appropriate relief in a court and may receive actual damages. The
prevailing party is entitled to recover court costs and reasonable
attorney's fees.
Sec. 93.052. NOTICE OF DAMAGE TO IMPROVEMENT OWNED BY
SURFACE OWNER. A mineral developer shall give each surface owner
written notice of damage to an improvement owned by the surface
owner and located on the land as soon as convenient but not later
than 24 hours after the damage occurs.
Sec. 93.053. NOTICE OF NONCOMPLYING AND HARMFUL EQUIPMENT.
If a well, pipeline, or other equipment installed by a mineral
developer ceases to comply with the rules of the commission in such
a way as to present a risk of harm to the surface of land or a person
occupying the land, the mineral developer shall notify each surface
owner of the risk.
[Sections 93.054-93.100 reserved for expansion]
SUBCHAPTER C. DAMAGES
Sec. 93.101. APPLICABILITY. (a) A surface owner is
entitled to damages as provided by this subchapter regardless of
whether:
(1) the surface estate of the land has been severed
from the mineral estate; or
(2) the surface owner is the person who executed the
instrument that gave the mineral developer the right to conduct
mineral exploration and production operations on the land.
(b) This subchapter does not apply to damages caused by an
unforeseen or accidental act or by an act of omission.
Sec. 93.102. REMEDIES CUMULATIVE. The remedies provided by
this subchapter are in addition to any other remedies provided by
law.
Sec. 93.103. WAIVER OF RIGHTS. (a) A surface owner may
waive the surface owner's rights under this subchapter.
(b) A waiver under this section must be in writing.
Sec. 93.104. RIGHT TO PAYMENT FOR DAMAGES. (a) A mineral
developer shall pay each surface owner an amount equal to the amount
of anticipated and foreseeable damages sustained by the surface
owner for the following, to the extent the damages are caused by
mineral exploration and production operations on the surface
owner's land:
(1) loss of income derived from agricultural use of
the land;
(2) reduction in value of the land;
(3) reduction in value of improvements to the land;
(4) loss of access to the surface of the land; and
(5) loss of the use of the surface of the land.
(b) Except as provided by Subsection (c), the amount of
compensation for damages under Subsection (a) may be determined by
any formula agreed to by the mineral developer and the surface
owner.
(c) The computation of the amount of compensation for
damages described by Subsection (a) to which the surface owner is
entitled must take into account:
(1) the amount of land affected by mineral exploration
and production operations; and
(2) the length of the period during which the loss or
reduction in value occurs.
(d) A surface owner may be paid the compensation for the
amount of the damages in annual installments or in a lump-sum
payment, except that a surface owner whose damages are caused
solely by mineral geophysical and seismographical exploration
activities shall be paid for the damages in a lump-sum payment.
(e) Payments under this section are intended to compensate
the surface owner only for anticipated and foreseeable damages.
(f) A surface owner may not reserve or assign the right to
compensation for damages described by Subsection (a) apart from the
surface estate, except that a surface owner may assign the surface
owner's right to compensation for damages described by Subsection
(a) to a tenant of the surface owner.
Sec. 93.105. AGREEMENT TO PAY DAMAGES. (a) At the time
notice required by Section 93.051 is given to a surface owner, the
mineral developer shall give to the surface owner a written offer to
pay compensation for damages as provided by Section 93.104.
(b) The surface owner may accept or reject the offer. An
acceptance of the offer must be in writing.
(c) Except as provided by Section 93.106(c), the mineral
developer may not enter the land with heavy equipment until the
mineral developer enters into a written agreement for the payment
of compensation for damages with each surface owner.
Sec. 93.106. SUIT IN DISTRICT COURT. (a) If the mineral
developer cannot determine or locate all of the surface owners with
reasonable diligence or if a surface owner rejects the mineral
developer's offer under Section 93.105, the mineral developer may
bring an action in a district court in the county in which the land
is located for a judgment specifying the amount of compensation for
damages, if any, the mineral developer is required to pay the
surface owner or owners with whom no agreement has been made.
(b) A mineral developer who gives notice under Section
93.051 may not bring an action under this section before the 30th
day after the date the notice is given.
(c) Notwithstanding Section 93.105(c), a mineral developer
who brings an action under this section may enter the land with
heavy equipment.
(d) The court shall appoint an attorney ad litem to
represent a surface owner who cannot be determined or located.
(e) The mineral developer and a surface owner who is a party
to the suit shall mutually appoint three appraisers. If more than
one surface owner is a party to the suit, the surface owners shall
agree on which surface owner is entitled to appoint the appraisers.
If the mineral developer and the surface owner who is entitled to
appoint appraisers are unable to agree on the appraisers to be
appointed, the mineral developer and the surface owner shall each
appoint one appraiser, and the two appraisers appointed shall
select a third appraiser to be appointed by the court. Unless the
court grants additional time for good cause shown, the appraisers
must be selected by the 20th day after the date the petition
initiating the suit is filed. If some or all of the appraisers have
not been selected by that date, the court shall appoint the
remaining appraisers.
(f) The appraisers shall inspect the land and determine an
amount to compensate each surface owner who is a party to the suit
for the damages the owner has sustained or will sustain because of
the mineral exploration and production operations. Not later than
the 30th day after the date they are appointed, the appraisers shall
file a written report with the court recommending the amount of
compensation, if any, the mineral developer shall pay each surface
owner who is a party to the suit. Section 93.104 governs the
determination of the amount of damages to which each surface owner
who is a party to the suit is entitled and whether the compensation
shall be paid in installments or a lump sum. Not later than the 10th
day after the date the report is filed, the clerk of the court shall
mail a copy of the report to the mineral developer and each surface
owner who is a party to the suit.
(g) After considering the appraisers' report, the court
shall determine:
(1) the amount of compensation, if any, the mineral
developer shall pay each surface owner who is a party to the suit
and the manner in which the compensation must be paid; and
(2) the compensation to which the appraisers are
entitled.
(h) The court shall enter an order:
(1) directing the mineral developer to pay each
surface owner who is a party to the suit the appropriate amount of
compensation, if any, determined under Subsection (g)(1) and
specifying the manner in which the compensation must be paid;
(2) directing the mineral developer and the surface
owners who are parties to the suit to each pay to the appraisers a
share of the amount determined under Subsection (g)(2) so that
one-half of the amount is paid by the surface owners in proportion
to their undivided interests in the surface of the land and one-half
of the amount is paid by the mineral developer; and
(3) directing the mineral developer and the surface
owners who are parties to the suit to each pay a share of the court's
costs so that one-half of the costs are paid by the surface owners
in proportion to their undivided interests in the surface of the
land and one-half of the costs are paid by the mineral developer.
(i) If a surface owner cannot be determined or located, the
mineral developer shall pay into the registry of the court the
compensation to which the surface owner is entitled under
Subsection (h)(1).
[Sections 93.107-93.150 reserved for expansion]
SUBCHAPTER D. RESTRICTIONS ON USE OF SURFACE
Sec. 93.151. REMOVAL OF EQUIPMENT. A mineral developer
shall remove equipment, structures, materials, supplies,
pipelines, and other property used by the mineral developer in
connection with mineral exploration and production operations on
the land not later than the first anniversary of the date the
mineral developer ceases to use the property.
Sec. 93.152. DISPOSAL OF WATER. A mineral developer may not
dispose of water or other liquids used in hydraulic fracturing or
other mineral exploration and production operations on the surface
of the land without the agreement of each surface owner.
Sec. 93.153. UNATTENDED MINOR CHILDREN. A mineral
developer may not allow minor children of employees of the mineral
developer to be unattended on the land without the agreement of each
surface owner.
Sec. 93.154. PETS. A mineral developer may not allow pets
of employees of the mineral developer outside of a vehicle or living
quarters on the land without the agreement of each surface owner.
Sec. 93.155. HUNTING. A mineral developer may not allow
employees of the mineral developer to hunt on the land without the
agreement of each surface owner.
Sec. 93.156. REPLACEMENT OF SOIL. After the cessation of
mineral exploration and production operations, a mineral developer
shall fill with soil any trench or depression created by the removal
of soil for purposes of those operations.
Sec. 93.157. ACCESS TO SURFACE OF LAND. A mineral developer
may not block a fire lane, road, or other means of access to the land
without the permission of each surface owner.
Sec. 93.158. FIRES. A mineral developer's employees may
not scavenge wood or start an open fire on the land without the
permission of each surface owner.
Sec. 93.159. DISPOSAL OF WASTE. (a) A mineral developer
shall pick up daily and properly dispose of trash, litter, and other
waste generated in the course of mineral exploration and production
operations on the land.
(b) A mineral developer may not bury waste under the land
without the consent of each surface owner.
Sec. 93.160. UNNECESSARY EQUIPMENT, MATERIAL, OR VEHICLES.
A mineral developer may not bring, store, or park on the land
equipment, material, or vehicles that are not related to or
necessary for exploration, production, or transportation of the
minerals.
Sec. 93.161. UNNECESSARY ACTIVITIES. A mineral developer
may not conduct activities on the land that are not necessary and
reasonable without the consent of each surface owner.
Sec. 93.162. USE BY CONTRACTORS AND SUBCONTRACTORS LIMITED
TO NECESSARY FACILITIES. A contractor or subcontractor of a
mineral developer may use only the access roads, drilling pads,
pipelines, or other facilities necessary to perform work in
connection with the development of the minerals without the consent
of each surface owner.
Sec. 93.163. USE OF EXISTING ROADS AND CORRIDORS FOR
CONSTRUCTION ACTIVITIES. A contractor or subcontractor of a
mineral developer shall:
(1) use only existing roads, utility corridors, and
routes along the border of the land to the extent practicable; and
(2) avoid construction of drill sites, access roads,
or pipelines in streamside management zones to the extent
reasonable alternatives are available.
Sec. 93.164. SANITATION. (a) A mineral developer shall
provide portable toilets for use by employees of the mineral
developer or contractors or subcontractors of the mineral developer
while working on the land.
(b) An employee of the mineral developer or of a contractor
or subcontractor of the mineral developer may not defecate on the
land.
Sec. 93.165. GATES. A mineral developer shall keep all
gates on the land locked at all times except when entering or
exiting the land.
[Sections 93.166-93.200 reserved for expansion]
SUBCHAPTER E. ENFORCEMENT
Sec. 93.201. ADMINISTRATIVE PENALTY. The commission may
impose an administrative penalty in an amount and in the manner
provided by Sections 81.0531-81.0534 on a person who violates this
chapter.
Sec. 93.202. CRIMINAL PENALTY. (a) A person commits an
offense if the person violates this chapter.
(b) An offense under this section is a Class C misdemeanor.
SECTION 2. The change in law made by this Act applies only
to liability for damage to the surface of land caused by the use of
the surface for mineral exploration and production operations on or
after the effective date of this Act. Liability for damage to the
surface of land caused by the use of the surface for mineral
exploration and production operations before the effective date of
this Act is governed by the law in effect on the date the damage was
caused, and that law is continued in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2011.