TX Railroad Commission to close eminent domain loophole, but still too vague
“The Texas Railroad Commission, that regulates the oil and gas industry, recently proposed a new rule to close the so-called ’T-4’ loophole that’s long allowed private pipeline companies to claim common carrier status by simply checking a box on a one-page form and gain eminent domain authority. In 2011, the Texas Supreme Court said in its Denbury Green decision that companies need to prove they’re truly a public use pipeline, known as a common carrier, before they obtain or exercise eminent domain powers. It quickly became an issue with the Keystone Pipeline, which TransCanada claimed to be a Texas common carrier and used eminent domain for its private international pipeline.
The proposed rule would give the Commission the ability to revoke a permit if a company violates the law, giving the Commission enforcement powers that it currently doesn’t have. It would also mandate permits must be renewed on an annual basis. The legislature contemplated at least four bills to fix the problem last year, but none of them passed. While the Railroad Commission rule makes an effort to quell the controversy, it stops short of fixing the problem.”
Hall, Terri. Examiner.com 25 July 2014.