CHAPTER 90. INTERSTATE COMPACT TO CONSERVE OIL AND GAS
NATURAL RESOURCES CODE
TITLE 3. OIL AND GAS
SUBTITLE B. CONSERVATION AND REGULATION OF OIL AND GAS
CHAPTER 90. INTERSTATE COMPACT TO CONSERVE OIL AND GAS
Sec. 90.001. RATIFICATION. The Interstate Compact to Conserve
Oil and Gas, executed in the City of Dallas, on February 16,
1935, by the Governor of Texas, the text of which is set out in
Section 90.007 of this code, was ratified by the legislature of
this state in Chapter 81, General Laws, Acts of the 44th
Legislature, Regular Session, 1935.
Acts 1977, 65th Leg., p. 2556, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.002. ORIGINAL COPY. The original copy of the compact is
on deposit with the Department of State of the United States.
Acts 1977, 65th Leg., p. 2556, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.003. REPRESENTATIVE. (a) The governor is the official
representative of the State of Texas on the Interstate Oil
Compact Commission, provided for in the Interstate Compact to
Conserve Oil and Gas. He shall exercise and perform for the state
all the powers and duties as a member of the Interstate Oil
Compact Commission.
(b) The governor may appoint an assistant representative who
shall act in his stead as the official representative of the
State of Texas as a member of the commission.
(c) The representative shall take the oath of office prescribed
by the constitution, which shall be filed with the Secretary of
State.
Acts 1977, 65th Leg., p. 2556, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.0031. ANNUAL REPORT. Before October 1 of each year, the
office of the Interstate Oil Compact Commissioner for Texas shall
prepare and file with the presiding officer of each house of the
legislature a complete and detailed written report describing the
activities of the office relating to this state's participation
in the Interstate Compact to Conserve Oil and Gas and accounting
for all funds received and disbursed by the office during the
preceding fiscal year. The report must be included as a part of
the annual financial report of the governor's office.
Added by Acts 1983, 68th Leg., p. 93, ch. 14, Sec. 1, eff. Aug.
29, 1983.
Sec. 90.004. EXTENSION. (a) The continuous extension of the
Interstate Compact to Conserve Oil and Gas until September 1,
1951, by an agreement executed by the governor in the name of the
State of Texas with other states currently members of the
Interstate Oil Compact Commission was authorized by the
legislature, subject to the approval of Congress, in:
(1) Chapter 217, Acts of the 45th Legislature, Regular Session,
1937;
(2) Chapter 2, Special Laws, page 527, Acts of the 46th
Legislature, Regular Session, 1939;
(3) Chapter 63, Acts of the 47th Legislature, Regular Session,
1941;
(4) Chapter 15, Acts of the 48th Legislature, Regular Session,
1943; and
(5) Chapter 52, Acts of the 50th Legislature, Regular Session,
1947.
(b) The governor may execute agreements in the name of the State
of Texas for the further extension of the expiration date of the
Interstate Compact to Conserve Oil and Gas.
Acts 1977, 65th Leg., p. 2556, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.005. FORM OF AGREEMENT. The agreement to extend the
Interstate Compact to Conserve Oil and Gas, which the governor is
authorized to execute for the state, shall be in substance as
follows:
"It is hereby agreed that the Interstate Compact to Conserve Oil
and Gas executed in the City of Dallas, Texas, on the 16th day of
February, 1935, and now on deposit with the Department of State
of the United States, be and the same is hereby extended for a
period of four (4) years from its date of expiration (September
1, 1947), this agreement to become effective when executed by any
three (3) of the States of Texas, Oklahoma, California, Kansas
and New Mexico, and consent thereto is given by Congress."
Acts 1977, 65th Leg., p. 2556, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.006. WITHDRAWAL FROM COMPACT. (a) The governor may
determine if and when it is in the best interest of the state to
withdraw from the compact as provided by its terms on 60 days'
notice.
(b) If the governor determines that the state should withdraw
from the compact, he has full authority to give necessary notice
and take any steps necessary and proper to effect the withdrawal
of the State of Texas from the compact.
Acts 1977, 65th Leg., p. 2557, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.
Sec. 90.007. TEXT OF COMPACT. The Interstate Compact to
Conserve Oil and Gas reads as follows:
"AN INTERSTATE COMPACT TO CONSERVE OIL AND GAS
"ARTICLE I
"This agreement may become effective within any compacting state
at any time as prescribed by that state, and shall become
effective within those states ratifying it whenever any three (3)
of the States of Texas, Oklahoma, California, Kansas and New
Mexico have ratified, and Congress has given its consent. Any
oil-producing state may become a party hereto as hereinafter
provided.
"ARTICLE II
"The purpose of this Compact is to conserve oil and gas by the
prevention of physical waste thereof from any cause.
"ARTICLE III
"Each state bound hereby agrees that within a reasonable time it
will enact laws, or if laws have been enacted, then it agrees to
continue the same in force, to accomplish within reasonable
limits the prevention of:
"(a) The operation of any oil well with an inefficient gas-oil
ratio;
"(b) The drowning with water of any stratum capable of producing
oil or gas, or both oil and gas, in paying quantities;
"(c) The avoidable escape into the open air or the wasteful
burning of gas from a natural gas well;
"(d) The creation of unnecessary fire hazards;
"(e) The drilling, equipping, locating, spacing, or operating of
a well or wells so as to bring about physical waste of oil or gas
or loss in the ultimate recovery thereof;
"(f) The inefficient, excessive, or improper use of the reservoir
energy in producing any well.
"The enumeration of the foregoing subjects shall not limit the
scope of the authority of any state.
"ARTICLE IV
"Each state bound hereby agrees that it will, within a reasonable
time, enact statutes, or if such statutes have been enacted then
that it will continue the same in force, providing in effect that
oil produced in violation of its valid order and/or gas
conservation statutes or any valid rule, order, or regulation
promulgated thereunder, shall be denied access to commerce; and
providing for stringent penalties for the waste of either oil or
gas.
"ARTICLE V
"It is not the purpose of this Compact to authorize the states
joining herein to limit the production of oil or gas for the
purpose of stabilizing or fixing the price thereof, or create or
perpetuate monopoly, or to promote regimentation, but is limited
to the purpose of conserving oil and gas and preventing the
avoidable waste thereof within reasonable limitations.
"ARTICLE VI
"Each state joining herein shall appoint a representative to a
Commission hereby constituted and designated as The Interstate
Oil Compact Commission, the duty of which said Commission shall
be to make inquiry and ascertain from time to time such methods,
practices, circumstances, and conditions as may be disclosed for
bringing about conservation and the prevention of physical waste
of oil and gas; and at such intervals as said Commission deems
beneficial it shall report its findings and recommendations to
the several states for adoption or rejection.
"The Commission shall have power to recommend the coordination of
the exercise of the police powers of the several states within
their several jurisdictions to promote the maximum ultimate
recovery from the petroleum reserves of said states, and to
recommend measures for the maximum ultimate recovery of oil and
gas. Said Commission shall organize and adopt suitable rules and
regulations for the conduct of its business.
"No action shall be taken by the Commission, except: (1) by the
affirmative votes of the majority of the whole number of the
compacting states, represented at any meeting; and (2) by a
concurring vote of a majority in interest of the compacting
states at said meeting, such interest to be determined as
follows: Such vote of each state shall be in the decimal
proportion fixed by the ratio of its daily average production
during the preceding calendar half-year to the daily average
production of the compacting states during said period.
"ARTICLE VII
"No state by joining herein shall become financially obligated to
any other state, nor shall the breach of the terms hereof by any
state subject such state to financial responsibility to the other
states joining herein.
"ARTICLE VIII
"This Compact shall expire September 1, 1937. But any state
joining herein may, upon sixty (60) days notice, withdraw
herefrom.
"The representatives of the signatory states have signed this
agreement in a single original, which shall be deposited in the
archives of the Department of State of the United States, and a
duly certified copy shall be forwarded to the Governor of each of
the signatory states.
"This Compact shall become effective when ratified and approved
as provided in Article I. Any oil-producing state may become a
party hereto by affixing its signature to a counterpart to be
similarly deposited, certified, and ratified."
Acts 1977, 65th Leg., p. 2557, ch. 871, art. I, Sec. 1, eff.
Sept. 1, 1977.