American Oil and Gas Reporter - February 2017 - 77

ConventionSection: Texas Independent Producers & Royalty Owners

New Year Provides TIPRO
New Reasons For Hope
By Dan Larson
Special Correspondent
AUSTIN, TX.-Optimism for a Texassize recovery is tempered by ongoing
uncertainty about commodity markets
and questions about what may be in store
for the oil and natural gas industry in the
2017 Texas Legislature, indicate leaders
of the Texas Independent Producers &
Royalty Owners Association.
As TIPRO members prepare for their
annual convention, scheduled for Feb. 27March 1 in Austin, they will hear from
industry and government leaders on topics
of immediate and critical importance.
"Our lineup of speakers, including former
Vice President Dick Cheney, will provide
a unique perspective on the new administration and issues affecting the industry,"
predicts TIPRO President Ed Longanecker.
"We are focusing on how the legal and regulatory landscape affects our members.
Otherwise, the outlook for our industry is
cautiously optimistic for this year."
Despite the industry's extended lull,
he reports the association is in good
health, and has seen little attrition in a
membership for which the rolls still top
3,000. Many of those members will be at
the Sheraton Austin Hotel at the Capitol
in late February for the association's
annual meeting.
Along with Cheney's keynote address,
the first day of the 2017 TIPRO conference
is scheduled to include remarks from
Texas Railroad Commissioner Wayne
Christian, an energy market update, an
executive panel, and a legislative reception.
The second day will include a membership
breakfast, regulatory update, and political
outlook panel as well as the convention's
tradition of call-up meetings at the Capitol,
and the annual chairman's reception and
dinner that evening, which will include
an award presentation to former Railroad
Commissioner David Porter.
Sunset Review
Leadership changes or external challenges to the RRC always are sure to
catch the attention of the state's oil and
gas industry, relates Allen Gilmer, TIPRO's

2016-18 chairman. Fortunately, says
Gilmer, who is chairman and chief executive officer of Drillinginfo Inc. in Austin,
there have been some encouraging developments. "The election of Wayne
Christian to the RRC in November brings
stability, and that is good for our business,"
Gilmer assesses.
Christian, a Republican from Center,
Tx., served in the Texas House from
1997 to 2003, and succeeds David Porter
on the three-member panel that also includes Chairwoman Christi Craddick and
Commissioner Ryan Sitton.
According to Longanecker, the first
issues confronting the commission this
year center on legislators' consideration
of the sunset review panel's recommendations. Last April, commission staff
issued a report describing seven recommendations to improve the RRC. After a
period of public comment and hearings,
the commission announced its conclusions
in a report issued late last year. Proposals
that failed to garner support in the final
recommendations included changing the
RRC's name, transferring contested hearings and gas utility oversight to other
state agencies, and amending the state's
bonding requirements.
The sunset commission report does
say the RRC should:
* Develop a strategic plan for tracking
the effectiveness of violation monitoring
and enforcement practices;
* Define repeat violations and report
repeat offenders on its website;
* Audit oil and gas production reports;
* Move toward electronic filing of
production reports; and
* Expand its risk matrix for oil and
gas inspections.
Other recommendations call on the
RRC to enforce damage prevention rules
for interstate pipelines and initiate a fee
for pipeline permits. The report also suggests
the legislature should amend the state's
General Appropriations Act to ensure permit
fees are returned to the RRC for administering a pipeline safety program.
Finally, the sunset report maintains,
all contracts under RRC authority should

be centralized and administered according
to best practices adopted by the legislature
and state comptroller. It also holds that
the RRC should adopt the sunset commission's across-the-board recommendations for alternative dispute resolution,
and disband the Oil and Gas Regulation
and Cleanup Fund Advisory Committee.
Getting It Right
Ultimately, Longanecker says, TIPRO
finds nothing in the report worthy of opposition. "We support the recommendations made by the sunset review panel,"
he reports.
In 2013, lawmakers failed to pass
RRC renewal legislation after the report
included provisions such as a requirement
that railroad commissioners resign before
they could run for another office, as well
as a call to consolidate the commission's
three-member leadership structure into a
single commissioner. Instead, lawmakers
voted to defer RRC renewal two years
(AOGR, June 2013, pg. 40).
For the 2015 session, sunset commission recommendations included moving
contested hearings and gas utility oversight
responsibilities to a different agency, and
the legislature punted again (AOGR, June
2015, pg. 114).
Gilmer expresses optimism the legislature will pass the recommendations this
year. "We saw a lot of ideas in the past
two sessions," he observes. "Some were
good and some were not. I think this is
the year the review finally is approved."
Meanwhile, RRC Chairwoman Craddick has been reported in media accounts
as making the rounds across Texas in a
campaign to secure additional funding
for commission operations. Since it generates much of its revenue by fees and
fines on the industry, Craddick says, RRC
funds have dipped more than 20 percent
during the past two years.
At the beginning of 2017, Craddick
says, the commission's 690 staffers lagged
the 2015 total by 100 employees. Moreover, in a published report of a speech
she gave to a Midland community group
in January, she estimated that the commission employed "another 150 people
FEBRUARY 2017 77

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