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Members,
Happy Fourth of July! We hope you have a safe holiday weekend and enjoy celebrating America's independence with friends and family. We are humbled to live in the greatest country in the world and can only be the Voice of the Permian Basin that we are because we live in the land of the free and the home of the brave.
As the Voice of the Permian Basin, we have been hard at work on your behalf and wanted to take a moment to update you on some of our latest activities. In this version of The Standard, we provide updates on the Texas Legislature, State and Federal Regulatory action, and the recent PBPA Membership Luncheon. As always, we have also provided information on upcoming PBPA events and other important community activities:
Important Updates
- Recap: June Membership Luncheon
- Texas Special Session Report
- State Regulatory Updates
- Federal Updates
- Q2 New Members
PBPA Events
- Sporting Clay Shoot & Oil Patch Pit King Challenge
- 2023 Annual Meeting
- Committee Meetings
Community Events
- Midland College PPDC Training Courses
- RRC Regulatory Conference
- West Texas Legislative Summit
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Additional events can be found on the calendar in the Member-Only Center!
Regards,
Ben Shepperd
PBPA President
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Recap: June Membership Luncheon | |
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“PBPA is having a national impact.” – Congressman August Pfluger
Thank you to everyone who joined us this week at our June Membership Luncheon! It was an honor to host U.S. Congressman August Pfluger. We do not traditionally hold summer luncheons, but we are glad we hosted this one as it was a great event and a pretty packed house!
Rep. Pfluger is a tireless advocate for the communities he serves and the vital Permian Basin petroleum industry. During his presentation, Rep. Pfluger covered a number of important issues at the federal level, including updates on legislative and regulatory priorities.
PBPA continues to work hard to be the best advocate we can be in Washington, D.C., but sometimes the best way to do that is to bring Washington, D.C. to our members! We greatly appreciate Rep. Pfluger’s service and wisdom and look forward to continuing to work with him to ensure that the Permian Basin remains the greatest place to live, work, and raise a family.
Special thanks to Ovintiv and Fasken Oil & Ranch for their sponsorship of the event!
Check out some of the event photos on our social pages.
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State Legislative Updates | |
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Texas Special Sessions
The 88th Legislature’s First Called Session ended without a compromise on property tax relief and ensures another round of legislating will occur in Austin this summer. The method by which Texas lawmakers are considering dispensing more than $17 billion dollars in relief this biennium stands at contention. Largely, the debate centers around two methods; tax compression or increasing the homestead exemption.
House Stance:
More than $5 billion of that total $17 billion has already been dispensed and is included in the state budget through compressing the property tax maintenance and operation (M&O) rate. This method uses dollars collected by the state from taxpayers in various means including sales, severance, franchise, etc. to effectively pay districts for the portion of the tax collected, or “buying the M&O rate down”. Proponents have noted that this method would ultimately allow the Legislature to continue paying this down and could lead to a total elimination of the M&O portion. This is the bulk of the House plan that has earned the support of the Governor. Opponents offer that this will require consistent funding from the state which has not always occurred due to the volatility in tax collections
The House has also floated a proposal that would limit the amount that an annual tax increase could be raised to 7.5% by all political subdivisions. The “Tax Assessment Increase Limit” (TAIL) was proposed after the House adjourned and has not been deliberated by either chamber just yet.
Senate Stance:
Conversely, the Senate’s proposal largely focuses on providing a homestead exemption increase from $35,000 to $100,000. This is a pretty straightforward proposal and would provide homeowners with a significant increase in their current exemptions, but some opponents note that this could be swallowed by appraisals in future taxing years. There have also been other conversations about additional relief after the initial proposals like including additional small businesses in the exemption from franchise tax collections. This package proposed by the Senate on June 20th was well after the House had adjourned “Sine Die” and well over the $17 billion budget in the General Appropriations Act.
With these considerations and new concepts being proposed, it should be noted that a special session may only be called by the Governor, may only last thirty days, and per Article 3, Section 40 of the Texas Constitution, “When the Legislature shall be convened in special session, there shall be no legislation upon subjects other than those designated in the proclamation of the Governor calling such session, or presented to them by the Governor.” This is especially relevant considering that the limitations in the call by the Governor were for tax compression to provide lasting property tax relief.
Perhaps less surprising, on Tuesday, June 27th Texas Governor Greg Abbott called for the Legislature to return, just under two hours after they adjourned. This Second Called Session of the 88th Legislature is called to meet, beginning at 3 pm on June 27, for the following purposes:
- ELIMINATING A PROPERTY TAX IN TEXAS: Legislation to put Texas on a pathway to eliminate school district maintenance and operations property taxes.
- LASTING PROPERTY TAX RATE CUTS: Legislation to cut property tax rates solely by reducing the school district maximum compressed tax rate in order to provide lasting property-tax relief for Texas taxpayers.
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On Wednesday, June 28th both the Senate and House convened to begin the Second Called Session of the 88th Legislature and at this time over 50 pieces of legislation have been filed across both chambers. However, only six of these offerings came from the Senate while the House has currently filed 53 bills and resolutions.
While the call is limited to what is written above, HB 1 and HJR 1 seem to be what is included in the call and SB 1 and SJR 1 look like the combination proposal offered by the Senate on June 20th. The remainder of the legislation filed includes a variety of other subjects including property tax relief/tax elimination concepts, border security, gender modification, health and human services, Medicaid, firearms, and environmental regulation.
Also on Wednesday, HB 1 and HJR 1 were both referred to House Ways and Means, heard in that committee and reported back to the full House favorably, without amendment. SB 1 and SJR 1 were both referred to Senate Finance, heard in committee, and voted back to the full Senate favorably without amendment, on Wednesday as well. The Senate continued to meet after the action in the Finance Committee and passed SB 1 and SJR 1 on third reading from the floor, sending the legislation over to the House for consideration. SJR 1 did not make it off the Senate floor without amendment, however. The SJR now includes language providing supplemental payment for full-time classroom teachers.
As always, we will continue to advocate on behalf of our members and keep you updated on the actions of the Texas Legislature as the Special Sessions continue.
For more information on Committee Assignments, filed legislation, or other Texas Legislative efforts, please reach out to Michael Lozano (michael@pbpa.info).
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RRC Accepting Comments on Amendments to Chapter 5 Rules Relating to Carbon Dioxide (CO2)
The RRC is accepting public comment on proposed amendments to 16 Texas Administrative Code (TAC) Chapter 5, relating to Carbon Dioxide (CO2).
Proposed amendments to 16 TAC §5.102, §5.201, §§5.203 - 5.207 are intended to respond to recommendations from the U.S. Environmental Protection Agency (EPA) to ensure that Texas’ regulations concerning geologic sequestration of carbon dioxide (Class VI injection wells) meet the minimum federal requirements for enforcement primacy for the federal Class VI Underground Injection Control (UIC) program. The EPA protects underground sources of drinking water by regulating the injection of fluids underground for storage or disposal. The Safe Drinking Water Act and UIC program provide the primary regulatory framework.
To view the proposed rule amendments and submit comments online by 5 p.m. on Monday, July 31, 2023, visit the RRC website at https://rrc.texas.gov/general-counsel/rules/proposed-rules/ under “Carbon Dioxide – Various Rules”.
If you are interested in PBPA submitting comments on these proposed amendments, please contact either Michael Lozano (michael@pbpa.info) or Stephen Robertson (stephen@pbpa.info).
RRC Approves New O&G Monitoring and Enforcement Plan for FY 2024
RRC commissioners have approved the agency’s Oil and Gas Monitoring Plan for Fiscal Year 2024.
The new plan includes goals to accurately demonstrate the RRC’s oil and gas monitoring and enforcement activities and to strategically use the oil and gas monitoring and enforcement resources. It focuses on developing a framework to describe the totality of oil and gas monitoring and enforcement efforts, beyond inspections and remediation work the agency does, which would include the extensive work that is done involving technical permit monitoring and administrative compliance enforcement.
The RRC’s well-plugging program, which has exceeded goals set by the Legislature for six straight years, will continue its prioritization system to extend its successful work plugging orphaned oil and gas wells throughout the state with state funds. This fiscal year the RRC utilized federal grants to add to the number of wells that were plugged. The agency has submitted comments on draft federal guidance on another set of grants that could be utilized next fiscal year.
“Our oil and gas regulatory work is nationally recognized because of our staff’s tireless work and the way we have leveraged technology to improve our efficiency over the years,” said Wei Wang, RRC Executive Director. “The new plan for next fiscal year keeps building on that as we regulate more than 430,000 wells in the state. Texas is the largest oil and gas producer in the nation, and we will continue to help that economic vitality.”
Staff training has been very important for the agency as it regulates a cutting-edge oil and gas industry. Inspectors will continue to receive in-house and external training to learn about the technologies employed in conventional and shale oil and gas field operations.
Part of the Commission’s most recent goals is to use data from inspections, enforcement, and compliance to improve our information management systems so that they are more user-friendly for operators. That work will continue in the next fiscal year to help efficiency for both RRC staff and oil and gas operators.
The Fiscal Year 2024 Oil and Gas Monitoring and Enforcement Plan can be found at this link: click here.
The Spanish version of the Oil and Gas Monitoring and Enforcement Plan for Fiscal Year 2024 is also available at this link: click here.
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BLM Public Land Use Rule
PBPA is working this week to finalize comments on the U.S. Bureau of Land Management’s (BLM) proposed Public Land Use rule. These comments are due on July 5, 2023. This commenting process has been worked through our Regulatory Practices Committee in conjunction with a group of other oil and gas trade associations. Regarding the proposed rule, this week the U.S. House Committee on Natural Resources market up and passed H.R. 3397, which would require the BLM to withdraw the proposal (labeled the Conservation and Landscape Health Rule). On this action, PBPA President Ben Shepperd provided, "Not only would the rule change the face of the Federal Land Policy and Management Act, but it allows BLM to sidestep its statutory mandates under a wide array of federal laws governing energy exploration. Therefore, if finalized, the rule would in general make it more difficult to develop energy-rich basins across the West, decrease investment in energy-related projects, prevent job creation, and reduce revenue for federal and state programs." Once PBPA has finalized its official comments, we will provide a copy of those comments to the membership.
EPA Possible Non-Attainment Designation
U.S. Environmental Protection Agency (EPA) Administrator Michael Regan testified before the House Energy and Commerce’s Subcommittee on Environment, Manufacturing, and Critical Materials in June to justify the Agency’s FY24 budget proposal. Congressman August Pfluger (R-TX) asked if the EPA is actively planning to redesignate the Permian Basin as nonattainment to which Administrator Regan responded, “That's a region six issue.” Pfluger stressed his dissatisfaction with the lack of response from the Administrator and the Region VI Administrator.
Congressman Pfluger has since also met with Region VI Administrator Earthea Nance. Coming out of that meeting, while it was not stated directly, it was made clear that Region VI will continue to pursue the non-attainment designation as early as this summer. However, in the most recently released unified agenda, such an action was not included.
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For more information about membership, please contact Christine Dooley at christine@pbpa.info or (432) 684-6345. | |
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Registration and Sponsorships are now available for PBPA'a annual Sporting Clay Shoot & Oil Patch Pit King Challenge!
This annual event takes place at Jake's Clays in Midland, TX, and features a morning sporting clay shoot followed by a delicious BBQ cook-off lunch.
PBPA's Clay Shoot is a great way to meet fellow industry leaders or treat your team to a day of fun and fellowship.
Not a shooter? Show off your skills by entering the Oil Patch Pit King Challenge and serve up your best pit delicacies at the event for a chance to be named this year's Pit King.
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Save the Date
Our Annual Meeting will be here before you know it. Block out September 27th and 28th on your calendar so that you can be sure to attend!
More details and information will be shared as the event nears. Check our website for updates as they become available.
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For more information on these events, please contact Jamie Ramirez at jamie@pbpa.info or (432) 684-6345. | |
- Health, Safety & Environment Committee: July 12, 2023
- Regulatory Practices Committee: July 18, 2023
For more information on these or any of our other committees, please contact Stephen Robertson at stephen@pbpa.info or (432) 684-6345.
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MC PPDC provides quality training programs designed to keep oil and gas industry professionals current in their areas of expertise by offering the latest industry updates, as well as providing timely and pertinent educational opportunities. Click the link below for upcoming classes being offered by the MC PPDC in the coming months.
Customized Training Available! For more information contact Midland College PPDC at (432) 683-2832 or cepetroleumtraining@midland.edu
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RRC Regulatory Conference | |
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Early bird registration for the Railroad Commission of Texas’ (RRC) Regulatory Conference ends on Friday, June 30. The registration fee for the conference is $450 per person if registered by June 30, and $550 per person if registered on or after July 1.
The conference will be held July 31-August 2 in Austin at the AT&T Hotel and Conference Center.
The RRC is hosting this conference to inform and train industry representatives on the applicable laws, rules, and procedures for hydrocarbon production in Texas. Plus, it will feature over 50 sessions covering a variety of topics.
In addition to RRC presenters, the conference will feature presenters from Entrust Solutions Group, Groundwater Protection Council, National Association of Pipeline Safety Representatives, National Transportation Safety Board, Pipeline and Hazardous Materials Safety Administration, RCP Inc., RegSafe, and Texas811.
For additional conference information and to register, visit the RRC’s website.
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West Texas Legislative Summit | |
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The San Angelo Chamber of Commerce's West Texas Legislative Summit will focus on federal issues with the overarching theme of “Food, Fuel, and Enforcement: West Texas Securing the Nation.”
Moreover, the 2023 Summit will highlight Agriculture, Energy, Economics, and National Security. The Honorary Co-Hosts each year are Congressman August Pfluger, Senator Charles Perry, and State Representative Drew Darby. Joni Ernst, a junior senator from Iowa whose career included service in the U.S. Army and the Iowa Army National Guard, will be the keynote speaker.
This year's summit kicks off with the Summit Soiree on the evening of Monday, July 31st at 6:00 pm. You will have the opportunity to meet with various legislators, agency leaders, panelists, sponsors, and other attendees. The Chamber anticipates an attendance of more than 400 people from across the state and country. They have scheduled a full day of panel discussions to begin on Tuesday, August 1st from 7:45 am-4:00 pm, where Senator Ernst will deliver the keynote speech.
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