Part 1.
GENERAL LAND OFFICE
Chapter 9.
EXPLORATION AND LEASING OF STATE OIL AND GAS
The Texas General Land Office adopts the amendments to §9.51,
relating to Royalty and Reporting Obligations to the State and §9.93,
relating to Assignments without changes to the proposed text as published
in the February 6, 2004, issue of the
Texas Register
(29 TexReg 1145). The text will not be republished.
The amendment to TNRC 9.51(a) corrects a typographical error. The rest
of the amendments conform the rules to legislative amendments to the Texas
Natural Resources Code. The amendment to TAC §9.51(b)(2)(N) conforms
the rule to an amendment to TNRC §52.136 by Acts 1997, 75th Leg., ch.
1324, §2, eff. Jan. 1, 1998. The amendment to TAC §9.51(b)(3)(A)
conforms the rule to an amendment to TNRC §52.131(e) by Acts 1993, 73rd
Leg., ch. 897, §30 eff. Sept. 1, 1993. The amendment to TAC §9.93(e)
conforms the rule to amendments to TNRC §52.026 made by Acts 1999, 76th
Leg., ch. 1125, §1, eff. Sept. 1, 1999 and by Acts 1999, 76th Leg., ch.
1483, §2, eff. Aug. 30, 1999. The changes are made pursuant to §2001.039
(Agency Review of Existing Rules) of the Government Code.
The General Land Office received a written comment on the proposed adoption
with amendment of TAC §9.93(e) from Ben Vaughan, III, an attorney.
Mr. Vaughan's comment on the proposed adoption with amendment: The proposed
change would release the assignor from liability for future breaches in the
event the Commissioner concluded that at the time of the proposed assignment
the assignee was fiscally responsible. I would suggest that two obligors of
performance of the lease obligations are better than one and that the lessee's
financial resources can evaporate on a moment's notice or without any notice
at all viz: Enron. Hence I would recommend that the provision of Section 9.93(e)
not be changed as proposed and that the existing Section 9.93(e) continue
as written.
Response: By amendment to TNRC §52.026, the Texas Legislature has
mandated that the liability of the transferor to properly discharge its obligations
under the lease shall pass to the transferee upon prior written consent of
the commissioner. The amendment simply conforms the rule to the will of the
Texas Legislature.
Subchapter D. PAYING ROYALTY TO THE STATE