No. V-0062 (1947).

• Case Date: March 06, 1947
• Court: Texas

Texas Attorney General Opinions 1947. No. V-0062 (1947). 1March 6, 1947Hon. H. L. Winfield, ChairmanOil, Gas and Conservation CommitteeState SenateAustin, TexasOpinion No. V-62Re: Senate Bill 227 providing for the sale of sweet or sour gas for the manufacture of carbon black and establishing a minimum priceDear Sir:We have your letter of February 28, 1947, reading as follows:

"At a public hearing of the Oil, Gas and Conservation Committee February 26th, Senate Bill 227, as amended, by Hazelwood, **onmotion of Senator Harris, was sent to a sub-committee with instructions to obtain an opinion from the Attorney General of Texas on the validity of the bill as amended, with instructions to report book one week from that date.

"Attached hereto is Committee Amendment No. 1 which represents the entire bill as amended. As Chairman of the Oil, Gas and Conservation Committee, and at the request of the Committee, I am requesting an opinion on (1) the validity or legality of the bill as a whole; and (2) the validity or legality of the following provision contained in the amended bill; 'and provided (2) that the price paid for such gas at the wellhead at least equals the market price paid at the wellhead in the area for gas used for light and fuel purposes.'

"You will observe the fact that this bill would amend, if passed, a conservation statute now on the books, and that

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the placing of the minimum price to be paid for the gas as quoted above is done in connection with the conservation features of the existing law. You will also observe that the language quoted does not in itself fix the price of the gas purchased under its provisions at any definite or fixed amount, but the price would fluctuate with the ordinary market price in the field as it is established from time to time by ordinary competitive methods for gas which is used for fuel and light purposes."

You informed us in a supplemental letter of March 3, 1947, as follows:

"In connection with the request for the opinion on Senate Bill 227 which was given to you recently, may I add, as Chairman of the Committee, that there was certain testimony and evidence before the Committee introduced in behalf of this bill that there now exists a considerable number of gas wells in the area affected by this proposed legislation which have no pipe line connections or market outlets for the gas. In this connection, it is also in evidence that a lack of connection necessarily results in drainage of non-producing

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