To Amend The Law Concerning Brine Production; And To Amend The Law Concerning The Formation Of Brine Production Units.
Summary
HB1413 amends Arkansas law governing brine production units and brine expansion units. The bill gives operators a formal process to ask the Arkansas Oil and Gas Commission to reduce the size of an existing brine unit by removing contiguous tracts, and it sets conditions the commission must find before approving that request. Those conditions include that the tract has no unplugged brine production or disposal well, that no brine wells have been located within one-half mile of the tract’s exterior boundary during the unit’s operation, and that removal will not cause drainage or imminent risk of drainage.
The bill also creates a process for operators of two adjacent brine production or expansion units to transfer contiguous tracts from one unit to another. The commission must approve such a transfer if the operator has rights to produce brine from at least 75% of each adjacent unit, the transfer will improve efficiency or expand operations, the tract will be efficiently drained, and the transfer will not harm royalty payments or substantially impair correlative rights. Once approved, the transferred tract becomes a brine expansion unit adjacent to the receiving unit.
Impact
HB1413 would modify Arkansas Code § 15-76-308 to expand the Arkansas Oil and Gas Commission’s authority over the configuration of brine production and expansion units. It affects brine operators, mineral and royalty owners, and adjacent unit holders by establishing new standards for shrinking units and transferring tracts between units. The bill is aimed at improving operational efficiency while preserving drainage protections, royalty interests, and correlative rights.
Sentiment
The available voting history shows strong bipartisan support and no recorded opposition, with the bill passing the House 93-0 and the Senate 34-0 on third reading. No committee transcripts are available, but the unanimous votes suggest the measure was viewed as a technical or industry-specific update rather than a controversial policy change.
Contention
No direct committee debate is available, and the floor votes indicate little to no opposition. The main substantive issues embedded in the bill are the protection of royalty owners and correlative rights versus the operator’s ability to reorganize unit boundaries for efficiency. The bill’s approval standards suggest the legislature sought to balance industry flexibility with safeguards against drainage and loss of value to tract owners.
Modifies collective Statewide transfer agreement and reverse transfer agreement; establishes New Jersey Transfer Ombudsperson within Office of Secretary of Higher Education.
Modifies collective statewide transfer agreement and reverse transfer agreement; establishes New Jersey Transfer Ombudsperson within Office of Secretary of Higher Education.