TX NATURAL RESOURCES CODE

SUBTITLE B. SURVEYS AND SURVEYORS

CHAPTER 32. SCHOOL LAND BOARD

SUBCHAPTER C. POWERS AND DUTIES


§ 32.061. BOARD'S GENERAL DUTIES.
     Except as provided by Subchapter G, Chapter 51, of this code, the board shall:
          (1) set the dates to open received bids for the sale of surveyed land dedicated to the permanent school fund, for the lease of land for prospecting or exploring for, mining, producing, storing, caring for, transporting, preserving, selling, or disposing of oil, gas, or other minerals leased under this chapter, and for the commitment of land to a contract for development;
          (2) determine the prices and set the terms of the contract for which land shall be sold, leased, or committed to a contract for development;
          (3) consult with the president, chairman, or other head of the department, board, or agency, as applicable, or with the representative of the head, on each matter before the board that affects land owned or held in trust for the use and benefit of a department, board, or agency of the state; and
          (4) perform any other duties which may be required by law.

Acts 1977, 65th Leg., p. 2378, ch. 871, art. I, § 1, eff. Sept. 1, 1977. Amended Acts 1985, 69th Leg., ch. 624, § 15, eff. Sept. 1, 1985; Acts 1993, 73rd Leg., ch. 897, § 2, eff. Sept. 1, 1993.

§ 32.062. ADOPTION OF RULES AND COLLECTION OF FEES.
     (a) The board shall adopt rules of procedure and rules for the sale, lease, and commitment to a contract for development of land as provided by this chapter.
     (b) The board by rule shall adopt and shall collect reasonable fees necessary to carry out this chapter.

Acts 1977, 65th Leg., p. 2379, ch. 871, art. I, § 1, eff. Sept. 1, 1977. Amended by Acts 1985, 69th Leg., ch. 624, § 16, eff. Sept. 1, 1985; Acts 1993, 73rd Leg., ch. 897, § 3, eff. Sept. 1, 1993.

§ 32.063. DUTY TO ADVISE COMMISSIONER.
     The board shall advise the commissioner regarding any matters submitted to it for that purpose.

Acts 1977, 65th Leg., p. 2379, ch. 871, art. I, § 1, eff. Sept. 1, 1977.

§ 32.064. SURVEY OR SUBDIVISION OF LAND.
     The board may have land surveyed or subdivided into tracts, lots, or blocks based on its determination of which method will be most conducive and convenient to facilitate the advantageous sale of land, the lease of land for oil, gas, or other minerals, or the commitment of land to a contract for development.

Added by Acts 1985, 69th Leg., ch. 624, § 17, eff. Sept. 1, 1985. Amended by Acts 1993, 73rd Leg., ch. 897, § 4, eff. Sept. 1, 1993.

§ 32.065. PERMITS FOR SURVEYS OR INVESTIGATIONS.
     If land other than public school land is not under a valid lease or committed to a contract for development, the board may issue a permit for a geological, geophysical, or other survey or investigation of that land that will encourage the development of the land for oil, gas, or other minerals. The permit may be issued for the consideration and under the terms and conditions the board considers to be in the best interest of the state.

Added by Acts 1985, 69th Leg., ch. 624, § 18, eff. Sept. 1, 1985. Amended by Acts 1993, 73rd Leg., ch. 897, § 5, eff. Sept. 1, 1993.

§ 32.066. EASEMENTS.
     (a) The board may grant easements of right-of-way on any land except:
          (1) unsold public school land;
          (2) the portion of the Gulf of Mexico within the jurisdiction of the state; and
          (3) islands, saltwater lakes, bays, inlets, marshes, and reefs owned by the state within tidewater limits.
     (b) The easements may be granted on terms and conditions the board considers to be in the best interest of the state.
     (c) This section shall not apply to land owned by the Texas Department of Transportation.

Added by Acts 1985, 69th Leg., ch. 624, § 19, eff. Sept. 1, 1985. Amended by Acts 1995, 74th Leg., ch. 165, § 22(51), eff. Sept. 1, 1995.

§ 32.067. MARGINAL PROPERTY ROYALTY RATES.
     (a) In this section:
          (1) "Barrel of oil equivalent" means 6,000 cubic feet of natural gas for each 42-gallon barrel of crude oil or a volume of gas with a minimum heating value of 6,000,000 British thermal units (6,000 Mbtu), whichever is greater.
          (2) "Qualifying Gulf of Mexico property" means land described in Section 52.011(2) that is subject to a lease issued under Subchapter B, Chapter 52.
          (3) "Qualifying Gulf of Mexico reservoir" means a reservoir that:
               (A) during a period established by board rule has an average daily per well production equal to or less than 50 barrels of oil or barrels of oil equivalent; and
               (B) underlies:
                    (i) a qualifying Gulf of Mexico property; or
                    (ii) a pooled unit that includes a qualifying Gulf of Mexico property.
          (4) "Qualifying property" means land subject to a lease issued under this chapter, under Subchapter E, Chapter 51, or under Chapter 52.
          (5) "Qualifying reservoir" means a reservoir that:
               (A) during a period established by board rule has an average daily per well production equal to or less than 15 barrels of oil or barrels of oil equivalent; and
               (B) underlies:
                    (i) a qualifying property; or
                    (ii) a pooled unit that includes a qualifying property.
          (6) "Reservoir" has the same meaning as "common reservoir" as that term is defined in Section 86.002.
     (b) The board by rule may provide for the reduction of royalty rates as provided by this section.
     (c) The royalty rate for oil and gas produced from a qualifying reservoir may be reduced to not less than one-sixteenth (6.25 percent) for a term prescribed by the board. In determining whether to grant a reduction in the royalty rate, the board may consider whether the qualifying property is being operated efficiently, including whether the property is pooled or has reasonable potential for the application of secondary or tertiary recovery techniques.
     (d) The royalty rate for the state's share under a lease issued under Subchapter F, Chapter 52, or Sections 51.195(c)(2) and (d) may be reduced under this section to not less than one-thirty-second (3.125 percent) for a term prescribed by the board. The state's royalty rate may be reduced under this subsection only if the royalty rate for the owner of the soil is reduced in the same proportion.
     (e) The royalty rate under a lease issued under Subchapter C, Chapter 52, may not be reduced to a rate that is lower than the rate under lease of land that:
          (1) adjoins the land leased under Subchapter C; and
          (2) is held or operated by, or under the significant control of, the state's lessee.
     (f) The royalty rate under a lease issued under Subchapter F of this chapter may not be reduced to a rate that is lower than the rate under a lease of land that adjoins the land leased under Subchapter F.
     (g) If a qualifying reservoir for which a royalty rate reduction is sought under this section is included in a unit subject to the board's authority, the board may modify the terms and conditions for the unit as a condition of approving the requested reduction in the royalty rate.
     (h) This section does not apply to the free royalty reserved by the state under Section 51.054.

Added by Acts 1995, 74th Leg., ch. 1007, § 1, eff. June 17, 1995. Amended by Acts 1999, 76th Leg., ch. 1300, § 1, eff. Sept. 1, 1999.