Railroad Commission of Texas – Natural Gas Critical Infrastructure

The Railroad Commission of Texas (Commission) has passed the first of its kind designation of natural gas facilities in the oil and gas sector for energy emergencies. The new rules implement provisions in House Bill 3648 and Senate Bill 3 and define natural gas facilities that would be designated as critical gas suppliers and critical customers.

Critical gas suppliers include, but are not limited to, gas wells, oil leases that produce gas, natural gas pipeline facilities, underground natural gas storage facilities and saltwater disposal facilities. Critical designation criteria for gas suppliers are as follows:

  1. Gas wells producing gas in excess of 15 Mcf/day;
  2. Oil leases producing casinghead gas in excess of 50 Mcf/day;
  3. Gas processing plants;
  4. Natural gas pipelines and pipeline facilities including associated compressor stations and control centers;
  5. Local distribution company pipelines and pipeline facilities including associated compressor stations and control centers;
  6. Underground natural gas storage facilities;
  7. Natural gas liquids transportation and storage facilities; and
  8. Saltwater disposal facilities including saltwater disposal pipelines.

Critical customers, which are a subset of critical gas suppliers, are facilities that require electricity to operate. These operators will submit a critical customer information to their electric utilities so that their electric utilities have the correct information for purposes of supplying power to the facilities. Critical customers meet the following definition:

A critical customer is a critical gas supplier for whom the deliver of electricity from an electric entity is essential to the ability of such gas supplier to operate. A critical customer is required to provide critical customer information to the electric entities described in §25.52 of 16 TAC Chapter 3 and the Texas Utilities Code § 38.074(b)(1) unless the critical customer is granted an exception.

The provision of the final rule took effect effective December 20, 2021 with operators of critical designated infrastructure subject to bi-annual filing with form CI-D to the Commission by January 15, 2022 and September 1, 2022, or 30 days from the data the Texas Electricity Supply Chain Security and Mapping Committee publishes the new electricity supply chain map of 2022 whichever is later. Then starting in 2023 the Form CI-D shall be filed by March 1 and September 1 of each year.

Critical designation maybe be subject to an exception if they meet certain criteria and can be demonstrated with objective evidence a reasonable basis and justification in support of the exception, as such as all of the gas produced at a facility is for on-site consumption, or the facility does not otherwise provide gas for third-party use. The Director of the Critical Infrastructure Division will approve or deny a request for an exception. If applying for an exception, the Form CI-X shall be submitted along with a $150 filing fee. In the year 2022 the form CI-X shall be filed bi-annually to the Commission by January 15 and September 1, or 30 days from the date the map is produced by the Texas Electricity Supply Chain Security and Mapping Committee, whichever is later. Starting in 2023, the form CI-X shall be filed March 1 and September 1 of each year. No filling fee is required once the original filing of form CI-X is approved by the Commission.

To view the final rules, go to https://www.rrc.texas.gov/media/xq4fiqda/adopt-new-3-65-amend-3-107-nov30-21-sig.pdf.

This is the first part of many steps in implementing the requirements of Senate Bill 3 in response to the February 2021 winter weather event (Winter Storm Uri). Operators should pay close attention to upcoming rulemakings regarding “weatherization” requirements and guidelines in which the Commission will initiate possibly in 2022.

The Commission will host new critical designation of natural gas infrastructure rule requirements trainings for operators and local distribution companies on the following dates:

Additional training videos and presentations can be found on the Commission webpage here:

CI Training (texas.gov)

To learn more about Altamira, contact us at info@altamira-us.com.

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