The bill amends existing laws regarding oil and gas production and conservation in Arkansas, specifically focusing on the allocation of production and costs following an integration order. It introduces a definition for "net proceeds" and clarifies the obligations of operators and working interest owners to mineral owners. The bill specifies that "net proceeds" will be defined in accordance with a new section added to the Arkansas Code, which outlines how gross proceeds from the sale of gas should be calculated based on whether a mineral interest is covered by an executed lease or not.

Additionally, the bill establishes that mineral ownership includes the right to contract regarding mineral interests and sets a minimum royalty of one-eighth (1/8) of the net proceeds from gas sales to royalty owners. It mandates that working interest owners are responsible for ensuring full royalty payments are made in compliance with lease terms and requires reimbursement to royalty owners for any unauthorized deductions. The provisions of this bill do not apply to units or wells producing only liquid hydrocarbons or gas associated with liquid hydrocarbons.

Statutes affected:
Old version HB1656 V2 - 3-19-2025 09:36 AM: 15-72-305
Old version HB1656 V3 - 4-1-2025 11:42 AM: 15-72-305
Old version HB1656 Original - 3-4-2025 11:49 AM: 15-72-305
HB 1656: 15-72-305
Act 1024: 15-72-305