OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
Mr. John It. Taylor, Chief supemlsor
Oil k 0ai1 Di~ia10~
Railroad Commlsal~n oi Texas
Austin, Texan
Dear Mr. Taylor;
9, 19&O, rsquee
or not thr Commlsolon
has the author head gar to be burned
without such gas
line Content, protidrd
plant is avallabla in
on has arisen, no doubt, by maeon
d (I), Saetion 3 cr drtiala 6006,
Tha production of natural gaa
in oxcees of transportation or market
faallltlee, or raaoonabla market demand for
the type of gaa produaed." (One of the
enumerated purposelr tor which the production
of gas is prohibited.)
Mr. John E. Taylor, pags 2
Ths aseumsd finding on the part o f the Railroad Comrsis-
sion that, as to tbs aubjsat gas, there would br no
adequate trsnaportation or market facilities, mkss it
nsosasary to deterstins whethdr them limitations operate
on production for othar purpoaes; that is, if the gas
cannot bs transported or sold, do the llmltatlone
prevent its production for othsr purposes? Othsr.pro-
visions of the aat warrant uasa of gaa by ths owner
other than for transporting or selling the sane on ths
mark&. Aocordlngly, subdsotlon (h) of Ssction 3 is
a?plicabls as a llnitatlon only whers the owuer is sn-
*aged in transporting or selling the gsa on ths market.
There can be no produotion In axcsss of ths ncsd ror
tranaport or sala except that ths sxcsss bs used ror
soms othsr lawful purposa. Tha limitation contained
in any ons subsaotlon of the act aannot reasonably be
interpreted to preoluds other lawful use and we do not
consider that the limnitation of this ssotlon operates
to pr;aoluds the manufacture of carbon black without
rirat extracting the gasoline content. Ws next sxamins
subasotlon (1) of Ssotion 3, Article 6006:
“(1) The use or natural gas ror
the manuraaturs ot carbon black without
first having extraotsd the natiral gaao-
line content from such gas.” (Ona of the
enumerated purposes for whish the produo-
tion of gas la prohlbltsd.)
WI lntsrprst this’ subsootion to smbraos a limltatlon on
produotlon of gas for a partloular ass; that like sub-
section (h), It ia not lnoluaivs of other ussa. wh6rs
ths owner puts hla gas primarily to ths use of manufaotur-
ing carbon black, the natural gasoline content mat be
flrst rsaonored.
Hers the subjeot gas Is casinghead‘ gas and
itB production i3 Only Incident t0 the production Or
oil, not primarily ror the manufacture of carbon black.
T’:e do not consider subssotion (1) of Section 3, Article
6008, as a limitation on it13 use.
’
hr. John E. Taylor, pegs 3
In examining the whole of Article 6008, ws
find other rsaaona for arriving at this conclusioa.
Casinghead gas Is by subsection (i), Section 2
of Article 6008 dsfined to be ‘*any gas and/or vapor in-
digenous to an oil stratum and pr@duced from such stratum
with 011.” Inasmuch aa br aubseatlou (d) of Ssation 2
any well producing in sxcsss of a gas/all ratio of 100,000
cubic fset of natural gas to each barrel of oruds petroleum
oil aonstltutsa a gas well, than ths prcductlon cb gas In
any well of less ratio oonstltutes an 011 well utisr sub-
-sotion (s) OS Section 2, and ths gas from an 011 well
is naosasarily casinghead gas.
Xs find in aubssation (m), Section 3, Articls
6008. by implication, gas from a well producing a gas/oil
ratlo of leas than 100,000 to 1 may be put to any use,
because it la only gaa produced in excess of that ratio
$a:sz;t be put to one or mora of the uses authorized.
:
%xctLon~ (ml.. The production of
mars than one hundred thousand ‘(1uZ:,UUoj
-cubic feet of gas to each barrel of crude
petroleum unless such gas Is put to one
or more of tbv uass authorized for the
typs of such gaB so produced under nllo-
cations made by the Commission. IQ
Thia provision Is one of a nunber defining
*waste”. By it oasinghead gas say be produced In quantltiea
of less than 100,000 cubic rest for 1 barrel of 011, and
not further utilized, without committ?ng statutory waete.
Accordingly, should we have given subsection (i) of
this section an Interpretation other than excluslvs In
ahsraatsr It v:ould hsvs bssn at variance with ths per-
mlasivs rssults of subsection (a). That gas not in ex-
CeBS of the prohibited ratio of 100,000 cubla feet of
gas to 1 barrel of oil may by virtue of subssotion (m)
be ellovsd to esaaps free into ths air without committing
statutory waste, it follovs that no reasonable li~aitation
could be placed upon the use of that gaa if not allowed
to escape. T2e prevention of waste is the foundation or
the poyrer of this governmental regulation arrd if complets
liberation of the gee withcut use is not wcste, than no
particular US4 of the gas could reasonably be determined
to be waste.
Mr. John B. Taylor, paga 4
_ For furthar light on the~. intendmant
.~. of tha
Lagialatura, we rarer to subaeation (31 of Section 7,
Article 6008, for speclrlo authorization tar tha
uses of casingheed gaa. It reads:
*Subsection (a).
Caainghaad gaa
may be used for eny benafiolal
Durpcaa,
which includes the manuracture of
nstural gasollne.w oQaphasla oura)
P;a interpret this provlalon undoubtedly to
include the sanufactura of carbon block, without the
in oaition cl the Ilaitatlons provided in subsections
(h7 and (1) of Section 3 of Article 6008.
Tour aeaond quaation 13 as ioll0ws:
aDoes the ~Conuaisslon have the author-
ity to parnit a gaaolina plant, -&lch vents
a portion of Its residue gas to the air
end operntaa iii a field which doea not
produce both sweat and 8our gas to take
Into its gathering linea and comaingle
in auoh lines and in the plant meet or
aour gas with casinghead gas if a volume
of reelduo gas eqaivalant to or in axcasa
of the total intake rrrvp gas walla, laes
shrinkage resulting rrom gasoline ex-
Lraotion, ie utilized for tha purpoa6
permitted for awaat and aour gas by Artiols
6008. ”
You hays quotad subsection (k) of Seatlon 3,
Article 6006, and aubaaotiona (1) and (2) of Saotlon
7, Article 6008. prammably‘aa provisions of the law
rafalng doubt as to the power of the Commiaalon to al-
low the venting,of dry gas, lrreapaotivs of the cir-
cumatancea sat out in your qunation. The atatad alr-
cumatanoes would indicate that aaid dry gaa would be
handled in such !na~er as aifactually to avoid waste.
It seam to us, howaver, that even though the manner
in which the dry gas may be handled would afiactually
avoid naata, yet neoerthalaaa, if in direct contraven-
tion of the provisions of the statutes, the ealaa can-
not be sanct ioaad. Subsection (k) OS Section 3 pro-
vidaa:
A!r. John l3. Taylor. pagr 5
%ubsectlon (k) . Permitting any natural
gas produced iron a gas wall to escape into
the air before or after such gas has bean
processed for its gaeolina content.* (Ona of
savaral provlslons darining mwaaten. )
Also Section 7 of Artiole 600e provides that
no gas from a gas wall shall be pemitted to escape
Into tha air, excopt that it be utilized for certain
purposes.
In the faoa of these two express statutory
prohibitions against the ralaasa of dry gas, that is,
awaet or sour gas irom a as well, wo ara of the belief
that it cannot be done. ftf there is a way of kindling
the gas so as to avoid praotioal waata with the venting
of a commingled mixture, containing in part dry gas, the
same will have to beg authorized by the Legislature.
Yours vary truly
Hugh &. Book
Assistant
RQB:BBB