American Oil and Gas Reporter - April 2015 - 171

ConventionCoverage: Texas Independent Producers & Royalty Owners

TIPRO Gets Behind Water,
Transportation Projects
By Danny Boyd
Special Correspondent

AUSTIN, TX.-Members of the Texas
Independent Producers & Royalty Owners
Association took their case directly to
state lawmakers during TIPRO's annual
meeting, March 2-4 in Austin, talking up
the oil and gas industry's contributions
to Texas' economy and pushing legislators
to promote water and transportation projects, head off local attempts to usurp
state regulatory authority, urge Congress
to lift the crude oil export ban, and provide
"contested case" reform.
Protecting members' interests is
TIPRO's top job, said Chairman Raymond
Welder III, president of Welder Exploration & Production Inc. in San Antonio,
during opening remarks at the convention
and biennial state capital call-up. "TIPRO
exists to preserve our ability to explore
and produce oil and gas," he declared.
The association continued to urge lawmakers to implement State Water Plan
projects. Failure to do so, according to
TIPRO's position paper, would result in
nearly 50 percent of Texans lacking adequate water by 2060. However, TIPRO
urged legislators to continue to allow the
oil and gas industry-without government
interference-to pursue its goal of further
reducing freshwater use to below the industry's current 1 percent of total statewide
consumption.
In a state issues panel, lawmakers told
TIPRO the legislature could consider
funding to map brackish water strata.
State Representative Drew Darby, R-San
Angelo, said that while Texas had done
extensive mapping of freshwater resources,
there was limited knowledge of brackish
water supplies, including limited details
on strata and their reach, and whether
brackish water strata were rechargeable.
"Part of the budget this session will
be directed to more mapping of brackish
water," he promised.
Brackish water is the property of surface owners, who should be compensated
for its use, and it shouldn't be regulated
by groundwater districts, added Darby,
who chairs the House Energy Resources

Committee and serves on the Ways &
Means Committee.
"I understand we need to have reasonable use of that water, and think it
should not be wasted, but I believe in the
technological developments of the industry
to move forward with potential water
opportunities," he stated.
There is no cookie-cutter approach to
developing and regulating brackish water
statewide, opined state Representative
Chris Paddie, R-Marshall. "What works
in West Texas may not work for East
Texas," he remarked. "There are different
challenges depending on the geology in
a particular area. There is no (specific)
framework that says what needs to happen
to (a certain) extent or to recycle (a
certain amount). It's just not feasible to
have that on a statewide level."
Darby predicted that water transportation also would be an issue for the legislature at some point. "The reality is, we
are going to have to move water," he
said. "That is going to be a challenge."
Water Implementation Fund
Carlos Rubinstein, chairman of the
Texas Water Development Board, told
TIPRO that as of Feb. 3, the board had re-

The Texas Water Development Board
has $800 million available to underwrite
State Water Plan projects this year, Chairman Carlos Rubinstein advises Texas
Independent Producers & Royalty Owners
Association members during their 2015
annual meeting, March 2-4 in Austin.

ceived 48 applications for more than $5.5
billion in projects under the State Water
Implementation Fund for Texas, or SWIFT.
Projects include reservoir capacity expansions, water transmission pipelines, conservation programs, canal lining, seawater
desalination, and reservoir projects.
Voters approved Proposition 6 in 2013,
which authorized $2 billion from the
Texas Rainy Day Fund to establish
SWIFT, he recalled.
He said $800 million was available
this year to help fund low-interest and
deferred loans, and projects in which the
Water Development Board would take a
temporary ownership interest. Funds are
available for planning, acquisition, design
and construction costs. Loans include
long-term, below-market fixed rates with
maturities ranging from 20 to 30 years,
Rubinstein said.
Project applications will be prioritized
according to criteria that include number
of people served, a diverse urban and rural
population, regional benefits, and percentage of water needs met. Other scoring criteria are the amount of the local financial
contribution, the financial capacity of the
applicant to repay, emergency need for
the project, readiness to proceed, effect
on water conservation, and the priority
given to a project by a regional water
planning group, Rubinstein outlined. Projects will be approved this summer, and
the board expects to authorize a bond sale,
he added, saying borrowers were expected
to close on loans in the fall.
Transportation
Transportation infrastructure and maintenance continue to be top priorities for
TIPRO, its position paper states. This
session, the association has endorsed SB
5 and SJR 5 from Senator Robert Nichols,
R-Jacksonville, to address long-term transportation funding.
The legislation calls for ending diversions by dedicating all State Highway
Fund (Fund 6) revenues to transportation,
along with a significant portion of motor
vehicle sales tax revenue, according to
the association.
At the TIPRO Chairman's Dinner,
APRIL 2015 171



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