88R26187 ANG-F     By: Birdwell, et al. S.B. No. 785     (Darby, Guerra, Morales of Maverick, Anchía)     Substitute the following for S.B. No. 785:  No.       A BILL TO BE ENTITLED   AN ACT   relating to the ownership of and certain insurance policy   provisions regarding the geothermal energy and associated   resources below the surface of land.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 2703.056, Insurance Code, is amended to   read as follows:          Sec. 2703.056.  EXCEPTIONS; MINERAL AND GEOTHERMAL ENERGY   INTERESTS.  (a)  Subject to the underwriting standards of the title   insurance company, a title insurance company may in a commitment   for title insurance or a title insurance policy include a general   exception or a special exception to except from coverage:                (1)  a mineral estate or the geothermal energy and   associated resources below the surface of the land; or                (2)  an instrument that purports to reserve or transfer   all or part of a mineral estate or the geothermal energy and   associated resources below the surface of the land.          (b)  A reduction to, or credit on a premium charge for, a   policy of title insurance or other insuring form may not be directly   or indirectly based on an exclusion of, or general or special   exception to, a mineral estate or the geothermal energy and   associated resources below the surface of the land in the title   insurance policy.          (c)  The inclusion in a title insurance policy of a general   exception or a special exception described by Subsection (a) does   not create title insurance coverage as to the condition or   ownership of the mineral estate or the geothermal energy and   associated resources below the surface of the land.          SECTION 2.  Section 141.003(5), Natural Resources Code, is   amended to read as follows:                (5)  "By-product" means any other element found in a   geothermal formation which is brought to the surface, whether or   not it is used in geothermal heat or pressure inducing energy   generation. The term does not include:                      (A)  a mineral, as defined by Section 75.001,   Property Code; or                      (B)  oil, gas, or a product of oil or gas, as   defined by Section 85.001.          SECTION 3.  Subchapter A, Chapter 141, Natural Resources   Code, is amended by adding Section 141.004 to read as follows:          Sec. 141.004.  OWNERSHIP OF GEOTHERMAL ENERGY AND ASSOCIATED   RESOURCES. (a) Except as otherwise expressly provided by a   conveyance, contract, deed, reservation, exception, limitation,   lease, or other binding obligation, the geothermal energy and   associated resources below the surface of land are owned as real   property by:                (1)  the landowner; or                (2)  if the surface estate and the mineral estate of the   land have been severed, the owner of the surface estate of the land.          (b)  Subject to the provisions of this chapter, the property   rights described by this section entitle the owner of the   geothermal energy and associated resources below the surface of   land and the owner's lessee, heir, or assignee to drill for and   produce the geothermal energy and associated resources.          (c)  This section does not:                (1)  apply to minerals dissolved or otherwise contained   in groundwater, including in hot brines; or                (2)  change existing law regarding:                      (A)  oil, gas, or mineral extraction regardless of   its heat or energy potential;                      (B)  the rights of the dominant and servient   estates; or                      (C)  the ownership and use of groundwater.          SECTION 4.  This Act takes effect immediately if it receives   a vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution.  If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2023.