HB3156 - Relating to fluid oil and gas waste and products and byproducts of that waste.

  89R9070 JAM-F     By: Darby H.B. No. 3156       A BILL TO BE ENTITLED   AN ACT   relating to fluid oil and gas waste and products and byproducts of   that waste.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 122.001, Natural Resources Code, is   amended by adding Subdivision (3) to read as follows:                 (3)     "Treated product" means the product of a process   that treats, filters, refines, extracts, or otherwise alters any   portion or component of fluid oil and gas waste to render it   suitable for a beneficial use.          SECTION 2.  Sections 122.002 and 122.003, Natural Resources   Code, are amended to read as follows:          Sec. 122.002.  OWNERSHIP OF FLUID OIL AND GAS WASTE   TRANSFERRED FOR TREATMENT AND SUBSEQUENT BENEFICIAL USE.  Unless   otherwise expressly provided by an oil or gas lease, a surface use   agreement, a contract, a bill of sale, or another legally binding   document:                (1)  when fluid oil and gas waste is produced and used   by or transferred to a person who takes possession of that waste for   the purpose of generating treated product [ treating the waste for a   subsequent beneficial use ], the waste is considered to be the   property of the person who takes possession of it for the purpose of   generating the treated product [ treating the waste for subsequent   beneficial use ] until the person transfers the waste or treated   product [ waste ] to another person for disposal or use; and                (2)  when a person who takes possession of fluid oil and   gas waste for the purpose of generating treated product [ treating   the waste for a subsequent beneficial use ] transfers possession of   the treated product or any [ treatment ] byproduct of the process   that generated the treated product to another person for the   purpose of subsequent disposal or beneficial use, the transferred   product or byproduct is considered to be the property of the person   to whom the material is transferred.          Sec. 122.003.  RESPONSIBILITY IN TORT.  (a)  Except as   provided by Subsection (b), a person who takes possession of fluid   oil and gas waste, produces from that waste a treated product   [ generally considered in the oil and gas industry to be suitable for   use in connection with the drilling for or production of oil or   gas ], and either puts the treated product to a beneficial use or   transfers the treated product to another person with the   contractual understanding that the treated product will be put to a   beneficial use [ used in connection with the drilling for or   production of oil or gas ] is not liable in tort for a consequence of   the subsequent use of that treated product by any [ the person to   whom the treated product is transferred or by another ] person.           (a-1)     Except as provided by Subsection (b), a person who   produces fluid oil and gas waste or who supplies or conveys fluid   oil and gas waste to a treatment facility for the purpose of   generating a treated product is not liable in tort for:                 (1)     a consequence of the subsequent treatment of that   fluid oil and gas waste to generate treated product;                 (2)     the subsequent use of that treated product by any   person; or                 (3)     exposure to a byproduct of the process used to   generate treated product.          (b)  This section does not affect the liability of a person   [ that treats fluid oil and gas waste for beneficial use ] in an   action brought by a claimant [ person ] for damages for personal   injury, death, or property damage arising from exposure to fluid   oil and gas waste , a treated product, or a byproduct of a process   used to generate treated product if that exposure occurred as a   result of the person's:                 (1)     gross negligence or intentional, wrongful act or   omission; or                 (2)     negligence and the person did not treat, generate,   use, or dispose of the fluid oil and gas waste, treated product, or   byproduct in conformity with:                       (A)  rules adopted under Section 122.004; or                       (B)     a Texas Pollutant Discharge Elimination   System program permit issued by the Texas Commission on   Environmental Quality under Section 26.027 or 26.131, Water Code .           (c)     A claimant awarded damages for a tort premised solely on   the person's negligence and regulatory nonconformity under   Subsection (b)(2) may not be awarded exemplary damages.          SECTION 3.  Section 122.004(a), Natural Resources Code, is   amended to read as follows:          (a)  The commission shall adopt rules to govern the treatment   and beneficial use of fluid oil and gas waste , treated product, and   any byproduct of a process used to generate treated product .          SECTION 4.  Chapter 122, Natural Resources Code, as amended   by this Act, applies only to a cause of action that accrues on or   after the effective date of this Act.  A cause of action that   accrues before the effective date of this Act is governed by the law   as it existed immediately before the effective date of this Act, and   that law is continued in effect for that purpose.          SECTION 5.  This Act takes effect September 1, 2025.