A bill firming what some legislators call an “historic agreement” between mineral owners and the oil and gas industry in the state was approved this week in the Oklahoma Senate. It came following decades of political disagreements over the interest accrued on royalty payments.
The full Senate unanimously passed House Bill 1371, which updates the Production Revenue Standards Act according to a negotiated agreement between mineral rights owners and oil and gas producers.
Sen. Grant Green, R-Wellston authored the measure which was approved on a 44-0 vote in the Senate. The bill had earlier won unanimous support, 10-9 in the state Senate Energy Committee.
“This legislation has been years in the making,” Green said. “After extensive negotiations with all parties, House Bill 1371 has become a win for mineral owners and the oil and gas producers that make energy Oklahoma’s top industry. This legislation reinforces the fundamental importance of private property rights by ensuring Oklahomans are fairly compensated for their mineral rights. At the same time, it gives industry leaders the regulatory certainty they need to keep growing their businesses. This agreement shows that we can protect landowners’ rights and support a thriving energy sector all at the same time.”
These changes provide clarity and consistency on the interest penalties owed to mineral owners on top of royalty payments, especially in instances when a producer cannot find the rightful owner of a mineral right. This legislation also provides an alternative to litigation that can drag on in the courts for years, taking a financial toll for all parties involved.
HB 1371 also creates the State-Managed Mineral Owner Fund, an escrow account under the State Treasurer’s purview, to ensure that unpaid proceeds are protected by state oversight. Mineral owners would have a clear path to recover their proceeds and interest from the fund upon providing proof of ownership.
HB 1371 now returns to the House, where Rep. Anthony Moore, R-Clinton, is the primary author.