The bill amends existing laws regarding oil and gas production and conservation in Arkansas, specifically focusing on the allocation of production and costs following integration orders. It introduces new definitions and requirements, including the definition of "net proceeds" and mandates that operators provide royalty owners with an itemized statement of accounting. This statement must detail each deduction from the royalty payments, clearly identifying the purpose and amount of each deduction. 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, allowing for higher negotiated royalties.

Furthermore, the bill outlines the responsibilities of working interest owners to ensure that royalty payments are made in accordance with lease terms, regardless of whether the operator or nonoperating working interest owners make the payments. It also stipulates that any unauthorized deductions must be reimbursed to the royalty owner within thirty days. The amendments aim to enhance transparency and protect the rights of mineral owners and royalty recipients in the oil and gas industry.

Statutes affected:
Old version HB1656 Original - 3-4-2025 11:49 AM: 15-72-305
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
HB 1656: 15-72-305