16 Tex. Admin. Code § 3.73 - Pipeline Connection; Cancellation of Certificate of Compliance; Severance
(a) No
pipeline or other carrier shall be connected with any well subject to the
jurisdiction of the Commission until the operator of the well provides the
pipeline or other carrier with a certificate from the Commission that the rules
in this title have been complied with. This section shall not prevent a
temporary connection with any well in order to take care of production and
prevent waste until the operator has a reasonable time, not to exceed 30 days
from the date of such connection, within which to obtain such certificate. For
purposes of this section, the term "Commission" means the Railroad Commission
of Texas, the Director of the Oil and Gas Division, or the Director's
delegate.
(b) No pipeline operator
shall physically disconnect its facilities from or cease providing pipeline
services to any well or lease without first obtaining:
(1) written consent of the well or lease operator for the proposed
disconnect or termination; or
(2)
written permission from the Commission. This section does not apply to
temporary suspensions of service authorized under other rules in this title or
attributable to maintenance, safety, or product quality
issues.
(c) If the
pipeline operator is unable to obtain the written consent of the well or lease
operator to physically disconnect from or cease providing service to the well
or lease, or the well or lease operator objects to the proposed physical
disconnect or termination of service, and the pipeline operator still desires
to physically disconnect from or cease providing service to the well or lease,
the pipeline operator shall file an application with the Commission requesting
permission to physically disconnect its facilities from or cease providing
service to the well or lease. An affected well or lease operator may object to
physical disconnection or cessation of service and file a complaint with the
Commission under this subsection.
(1) The
pipeline operator shall file its application with the Commission at least 30
days prior to the date on which the pipeline operator desires to make the
physical disconnection or cease providing service. On the same date as the
pipeline operator files its application with the Commission, the pipeline
operator shall send a copy of the application to the operator of the well or
lease affected by the application by certified mail, return receipt requested.
The application shall identify the well operator and pipeline operator,
identify each lease or well involved, and provide sufficient information to
allow the Commission to make a determination pursuant to paragraph (4) of this
subsection.
(2) If the operator of
the well or lease does not file with the Commission a written objection to the
application within 28 days following the filing of the application, the
Commission shall administratively approve or deny the application and shall
notify the pipeline operator and the well or lease operator of the decision by
certified mail, return receipt requested. Following such notification, either
party shall have 21 days to file a written request for hearing. If neither
party files a timely request for hearing, the administrative approval or denial
shall be deemed final.
(3) If
either party files a timely request for hearing, the Commission shall refer the
application to the Office of General Counsel docket services to be set for
hearing within 60 days following the date of referral.
(4) In determining whether or not to approve
a request to physically disconnect from or cease providing service to a well or
lease, the Commission may consider relevant factors, including but not limited
to:
(A) operational integrity of the pipeline
facilities;
(B) operational
integrity of the equipment on the well or lease;
(C) cost of continued operation of the physical connection or
service;
(D) risk to public safety,
human health and the environment;
(E) availability of alternative transportation;
(F) protection of correlative rights;
and
(G) prevention of
waste.
(d) The
Commission may shut in and seal any well, and cancel any certificate of
compliance if it appears that the operator of a well has violated or is
violating, in connection with the operation of the well, any statutes, rules in
this title, permits, or orders of the Commission. Upon receipt of information
that indicates operations are being conducted in violation of statutes, rules
in this title, or a Commission permit or order, the Commission shall send a
notice letter to the operator directing the operator to correct the violation.
The letter shall state the facts or conduct alleged to warrant the shut-in and
sealing of the well, and cancellation of the certificate of compliance. The
letter shall give the operator an opportunity to show compliance with the
statutes, rules in this title, or Commission permits or orders. The letter
shall be sent by registered or certified mail, and shall indicate the time
within which compliance shall be demonstrated or achieved. The time period
allowed for the operator to achieve compliance shall not be less than 10 days
from the date the notice letter is sent.
(e) Within the time period set out in the notice letter, the
operator shall either demonstrate compliance or correct the violation, and
notify the Commission of its action.
(f) If the violation is not corrected within the time period set
out in the notice letter, the Commission may shut in and seal the well, and
cancel the certificate of compliance.
(g) If a certificate of compliance has been
cancelled, the Commission may not issue a new certificate of compliance until
the owner or operator of the property covered by the certificate of compliance
submits to the Commission a reissuance fee as required by §3.78 of this
title (relating to Fees and Financial Security Requirements) (Statewide Rule
78); and
(1) the property covered by the
certificate is brought into compliance with the statutes, rules in this title,
and Commission permits and orders; or
(2) the Commission determines that there are just and equitable
grounds for reissuing the certificate.
(h) Pursuant to Texas Natural Resources Code,
§91.705, upon notice from the Commission to any operator of a pipeline or
other carrier connected to any well subject to the jurisdiction of the
Commission that the certificate of compliance applicable to the well has been
canceled by the Commission, the operator of the pipeline or other carrier shall
disconnect from or suspend service to the well and shall not reconnect to or
resume service to that well until a new certificate of compliance has been
issued by the Commission. Pursuant to Texas Natural Resources Code,
§85.3855, failure to comply with this subsection may subject a person to a
penalty of up to $10,000 per violation.
(i) Pursuant to Texas Natural Resources Code,
§91.706(a), upon notice from the Commission that a certificate of
compliance as to any well has been canceled as provided in this section, the
operator of such well shall not use that well for production, injection, or
disposal until a new certificate of compliance with respect to the well has
been issued by the Commission as provided in this section. Pursuant to Texas
Natural Resources Code, §85.3855, failure to comply with this subsection
may subject a person to a penalty of up to $10,000 per violation.
(j) Pursuant to Texas Natural Resources Code,
§
91.706(b),
if an operator uses or reports use of a well for production, injection, or
disposal for which the operator's certificate of compliance has been canceled,
the Commission may refuse to renew the operator's organization report required
by Texas Natural Resources Code, §
91.142, until
the operator pays the fee required pursuant to §
3.78(b)(8) of
this title (relating to Fees and Financial Security Requirements) and the
Commission issues the certificate of compliance required for that
well.
(k) The provisions of this
section shall be cumulative of other Commission actions and procedures relating
to violations of state statutes or Commission permits, rules, and orders,
including the authority of the Commission to immediately shut in a well or
lease, or to direct the operator to shut in a well or lease, when an emergency
exists due to pollution or an imminent threat of harm to people or
property.
Notes
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