Yesterday, HB 40, a bill to clarify the authority of the state of Texas to regulate oil and gas drilling, passed the Senate on a 25 to 6 vote. On April 20th, the Texas House passed the bill on a 125 to 20 vote and the bill is now on its way to Governor Abbott’s desk.

The Texas bill, which is very similar to NM HB 366, drafted by IPANM and sponsored by House Majority Whip Gentry, has provisions to allow municipalities and local governments to continue to regulate noise, dust and traditional zoning issues. In fact, the Texas bill seems to give surface owners a bit more latitude in discussing surface locations. However, HB 40 has a limitation of ‘commercial reasonableness’ which requires that “a reasonably prudent operator is allowed to fully, effectively and economically exploit, develop, produce, process and transport oil and gas, as determined based on the objective standard of a reasonably prudent operator and not on an individual assessment of an actual operator’s capacity to act.” The bill further states that only the State has the exclusive jurisdiction to regulate oil and gas operations and although the local government may enact ordinances regarding surface issues, it is limited to the commercial reasonableness standard and may not effectually prohibit any activity.