By: Keffer, et al. (Senate Sponsor - Eltife) H.B. No. 2207
         (In the Senate - Received from the House May 5, 2015;
  May 5, 2015, read first time and referred to Committee on Natural
  Resources and Economic Development; May 13, 2015, reported
  favorably by the following vote:  Yeas 10, Nays 0; May 13, 2015,
  sent to printer.)
Click here to see the committee vote
 
 
 
  COMMITTEE VOTE
 
 
         YeaNayAbsentPNV
         FraserX
         EstesX
         BirdwellX
         HallX
         HancockX
         HinojosaX
         LucioX
         NicholsX
         SeligerX
         UrestiX
         ZaffiriniX
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to the foreclosure sale of property subject to an oil or
  gas lease.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle B, Title 5, Property Code, is amended by
  adding Chapter 66 to read as follows:
  CHAPTER 66. SALE OF PROPERTY SUBJECT TO OIL OR GAS LEASE
         Sec. 66.001.  SALE OF PROPERTY SUBJECT TO OIL OR GAS LEASE.
  (a) In this section:
               (1)  "Mortgagee," "mortgagor," and "security
  instrument" have the meanings assigned by Section 51.0001.
               (2)  "Oil or gas lease" means an instrument conveying a
  fee simple determinable interest in a mineral estate covering oil,
  gas, or other hydrocarbons or a recorded memorandum of such an
  instrument.
               (3)  "Real property" means an estate covering the
  mineral interest in hydrocarbons or the mineral interest in
  hydrocarbons together with the surface overlying such mineral
  interest. The term does not include a surface interest or other
  interest that excludes a mineral interest in hydrocarbons.
         (b)  Notwithstanding any other law, an oil or gas lease
  covering real property subject to a security instrument that has
  been foreclosed remains in effect after the foreclosure sale if the
  oil or gas lease has not terminated or expired on its own terms and
  was executed and recorded in the real property records of the county
  before the foreclosure sale. An interest of the mortgagor or the
  mortgagor's assigns in the oil or gas lease, including a right to
  receive royalties or other payments that become due and payable
  after the date of the foreclosure, passes to the purchaser of the
  foreclosed property to the extent that the security instrument
  under which the real property was foreclosed had priority over the
  interest in the oil or gas lease of the mortgagor or the mortgagor's
  assigns.
         (c)  Notwithstanding Subsection (b), if real property that
  includes the mineral interest in hydrocarbons together with the
  surface overlying such mineral interest is subject to both an oil or
  gas lease and a security instrument and the security interest is
  foreclosed, the foreclosure sale terminates and extinguishes any
  right granted under the oil or gas lease for the lessee to use the
  surface of the real property to the extent that the security
  instrument under which the real property was foreclosed had
  priority over the rights of the lessee under the oil or gas lease.
         (d)  An agreement, including a subordination agreement,
  between a lessee of an oil or gas lease and a mortgagee of real
  property or the lessee of an oil or gas lease and the purchaser of
  foreclosed real property controls over any conflicting provision of
  this section. An agreement between a mortgagor and mortgagee may
  not modify the application of this section unless the affected
  lessee agrees to the modification.
         (e)  This section does not apply to a security instrument
  that does not attach to a mineral interest in hydrocarbons in the
  mortgaged real property.
         SECTION 2.  Chapter 66, Property Code, as added by this Act,
  applies only with respect to a foreclosure sale for which the notice
  of sale is given under Section 51.002, Property Code, on or after
  the effective date of this Act or a judicial foreclosure for which
  the judicial foreclosure action commenced on or after the effective
  date of this Act.
         SECTION 3.  This Act takes effect January 1, 2016.
 
  * * * * *