HB 5105

relating to the imposition on a payor of proceeds of production from
an oil or gas well of a duty to notify a payee when payments to the
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Subchapter J, Chapter 91, Natural Resources
Code, is amended by adding Section 91.409 to read as follows:
Sec. 91.409.  NOTIFICATION OF SUSPENSION OF PAYMENTS.  (a)
When a payor suspends a payment to a payee for a reason other than a
reason described by Section 91.402(f), the payor shall send to the
payee a written notice stating that payments have been suspended
and explaining in reasonable detail the reason for the suspension.
The notice must be sent not later than the 30th day after the date
the payment was suspended and must include the information required
(b)  A payor that suspends payment to a payee for a reason
other than a reason described by Section 91.402(f) without sending
to the payee notice of suspension as provided by Subsection (a)
shall pay to the payee interest on the amount of the suspended
payment for the period that begins on the 31st day after the date
the payment is suspended and ends on the date notice of the
suspension is delivered to the payee.  The rate of interest to be
paid under this subsection is a rate two points higher than the rate
charged for that period on loans to depository institutions by the
New York Federal Reserve Bank, unless a different rate is specified
by a written agreement between the payor and payee.
SECTION 2.  Section 91.409, Natural Resources Code, as added
by this Act, applies only to a suspension of a payment of proceeds
of production from an oil or gas well made on or after the effective
date of this Act.  A suspension of a payment of proceeds of
production from an oil or gas well made before the effective date of
this Act is governed by the law in effect on the date the suspension
was made, and the former law is continued in effect for that
SECTION 3.  This Act takes effect September 1, 2025.