Summary of Requirements and Responsibilities

For operations within the jurisdiction of the Railroad Commission

Any organization performing operations within the jurisdiction of the Railroad Commission of Texas (Commission) is required to maintain a current Form P-5, Organization Report. Operations within the Commission's jurisdiction include but are not limited to:

  • drilling, operating, or producing any oil, gas, geothermal resource, brine mining injection, fluid injection, or oil and gas waste disposal well;
  • transporting, reclaiming, treating, processing, or refining crude oil, gas and products, or geothermal resources and associated minerals;
  • discharging, storing, handling, transporting, reclaiming, or disposing of oil and gas waste, including hauling salt water for hire by any method other than pipeline;
  • operating gasoline plants, natural gas or natural gas liquids processing plants, pressure maintenance or repressurizing plants, or recycling plants;
  • recovering skim oil from a salt water disposal site;
  • nominating crude oil;
  • operating a directional survey company;
  • cleaning a reserve pit;
  • operating a pipeline;
  • operating as a cementer approved for plugging wells, operating as a cementer cementing casing strings or liners, or operating a well service company performing well stimulation activities, including hydraulic fracturing;
  • operating an underground hydrocarbon or natural gas storage facility;
  • gas and/or liquids company; or
  • master metered properties.

Commission rules (16 Texas Administrative Code, Chapter 3) related to filing the Form P-5:


Filing Fee

Organizations required to maintain a Form P-5 in accordance with associated rules and regulations are also required to submit a filing fee. There is no filing fee for a Form P-5 filed solely to update officers, agents and/or addresses.

  • Initial Form P-5 filing fee - $300. 
  • Annual renewal filing fee is based on an organization's activities (see Statewide Rule 78) - may be up to $1,350.

Gas Distribution System Operators and Master Metered Properties- If the operation of one or more gas distribution systems and master metered properties is the only activity for a Form P-5 being filed, make note in Item No. 8 (Remarks), and submit a $225 filing fee for both new filings and annual renewals.

Note: Filing fees do not include the surcharges required under Statewide Rule 78. 

Financial Assurance

In accordance with Statewide Rule 78, most Commission regulated activities, including the operation of wells and pipelines, require an organization to file and maintain some form of financial assurance in varying amounts.

Acceptable Forms of Financial Assurance

  • Option 1 (Available only to operators with no activity other than the operation of wells.)
    • Form P-5PB, Letter of Credit (Form P-5LC), or Cash Deposit
    • Amount is determined by multiplying the aggregate depth of all wells (active, inactive, injection, producer, etc.) at $2 per foot
  • Option 2 (Available to All Operators) - Form P-5PB, Letter of Credit (Form P-5LC), or Cash Deposit
    • Amount determined by the total number of wells (active, inactive, injection, producer, etc.)
      • No wells - $25,000
      • 1 to 10 wells - $25,000
      • 11 to 99 wells - $50,000
      • 100 wells are more - $250,000

Cash Deposit (Cashier's Check Only)

  • Can be filed under either Financial Security Option 1 or Option 2
  • Cash deposits are automatically renewed once an operator submits their Form P-5 renewal packet and filing fee
  • No fee required to renew cash deposit annually
  • Interest earned on cash deposits is allocated to the Oil and Gas Cleanup Fund (See TNRC §81.067)

Bay and Offshore Wells
Bay and offshore well operators are required to file additional financial assurance, because presumed plugging cost for Bay Well $60,000 and Offshore Well $100,000.

  • Amount is determined by Base amount + Entry Level amount + Non-Producing amount

Surety Companies & Agents List

Texas Department of Insurance’s List of Surety Companies & Agents

Disclaimer: The list of companies/agents at the above link is maintained by the Texas Department of Insurance. The Commission is not responsible for the accuracy, completeness, currency and/or suitability of the material provided at the link. Further, the Commission does not endorse or sponsor any of the companies/agents listed and does not guarantee that one of the listed companies/agents will agree to bond any particular operator.

Inactive Wells


For more information or assistance, email P-5 Financial Assurance at P5@rrc.texas.gov

Related Links

Commissioners

Research

General

Audiences