Harrison & Mecklenburg, Inc. Full-Service Law Firm Serving Kingfisher, Stillwater & Watonga

Thoughts on Oklahoma House Bill 2150

House Bill 2150 by Representative John Pfeiffer recently won approval on a vote of the House Energy and Natural Resources Committee. The bill has been promoted as protecting “mineral rights” from cities and counties. In reality, it takes away the current authority of cities and counties to enforce any local regulations that might impact the development of oil and gas, and consolidates what should be local powers with one state agency – the Oklahoma Corporation Commission.

For example, boards of county commissioners currently have exclusive authority to grant permission to private operators to place temporary pipelines along county road easements. These 66-foot wide road easements belong to the counties for purposes associated with the public highway system, and the well-established authority of the counties to regulate them comes from state statues and from the state constitution. HB 2150 would transfer this authority to the Corporation Commission, although short of a constitutional amendment, which has not occurred, the Corporation Commission has absolutely no authority over the county public highway system.

Likewise, we know that it now costs at least one million dollars to build one mile of concrete road. If this bill were to pass as presented, a city would have no recourse to help offset the costs of damage done to the roads during the drilling and completion phases of a new well. Since a city does not receive any gross production taxes or other revenue from oil and gas production, the liability of rebuilding the infrastructure destroyed in the process of drilling and completing new wells would now be thrown back onto the shoulders of the very mineral owners this bill pretends to protect – without the companies causing the damage being liable to repair that damage in any way.

In addition to the examples above, placement of high-pressure gas lines, gas plants, and transportation facilities are also all decisions that could potentially “[impact] the use and development of minerals” or “[prohibit] access to develop the mineral estate, thereby substantially increasing the cost of oil and gas operations,” yet these are decisions that directly impact families, farms, and businesses in Oklahoma. Such decisions should be made at the local level, where those who are impacted can have some voice in the decision.

Completely stripping a city or county of its ability to protect and carry out the wishes of its citizenry and placing that power in the hands of an entity such as the Corporation Commission that isn’t familiar with the nuances of local issues, and likely doesn’t care, starts to set a dangerous precedent.

By establishing a federalist form of government, the founding fathers rightly determined that governing should be divided between the federal government, and state and local governments, with local issues to be decided by local governments. Of course, a local entity should not be allowed to completely shut out an industry without any reason or logic behind the ruling. However, a local government entity should have the ability to protect its citizenry by placing reasonable restrictions on anything being conducted within its boundaries. HB 2150 is an attempt by “big oil” to take away the rights of local citizens by having all decisions made at the Corporation Commission, which is often impractical for individual citizens to navigate but where oil companies have great influence.

While we are a firm that generally represents mineral owners and their rights, we recognize that the oil and gas industry has been very good to Oklahoma. We believe the State should encourage the development of our resources, but there has to be a balance, and the balance has been tipping in favor of big oil for several years now. Our evaluation of this bill, or any other matter being considered as new law, is whether it is a reasonable measure for all involved or whether it is so blatantly one-sided as to be unconscionable. We think this bill, as proposed, falls into the latter. House Bill 2150 should not become law.