Texas Codes

Tex. Nat. Res. Code § 91.401 (2026)

Definitions

✓ current as of May 2026
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Sec. 91.401. DEFINITIONS. In this subchapter:

(1) "Payee" means any person or persons legally entitled to payment from the proceeds derived from the sale of oil or gas from an oil or gas well located in this state.

(2) "Payor" means the party who undertakes to distribute oil and gas proceeds to the payee, whether as the purchaser of the production of oil or gas generating such proceeds or as operator of the well from which such production was obtained or as lessee under the lease on which royalty is due. The payor is the first purchaser of such production of oil or gas from an oil or gas well, unless the owner of the right to produce under an oil or gas lease or pooling order and the first purchaser have entered into arrangements providing that the proceeds derived from the sale of oil or gas are to be paid by the first purchaser to the owner of the right to produce who is thereby deemed to be the payor having the responsibility of paying those proceeds received from the first purchaser to the payee.

(3) "Division order" means an agreement signed by the payee directing the distribution of proceeds from the sale of oil, gas, casinghead gas, or other related hydrocarbons. The order directs and authorizes the payor to make payment for the products taken in accordance with the division order. When used herein "division order" shall also include "transfer order".

(4) "Transfer order" means an agreement signed by a payee and his transferee (new payee) directing the payor under the division order to pay another person a share in the oil or gas produced.

Added by Acts 1983, 68th Leg., p. 966, ch. 228, Sec. 1, eff. Sept. 1, 1983. Amended by Acts 1991, 72nd Leg., ch. 650, Sec. 1, eff. Aug. 26, 1991.

Notes of Decisions
Cited in 24 cases (6 in the last 5 years), 1995–2025 · leading case: Koch Oil Co. v. Wilber, 895 S.W.2d 854 (Tex. App. 1995).
Koch Oil Co. v. Wilber, 895 S.W.2d 854 (Tex. App. 1995). · cites it 6× “Tesoro's points of error 10 and 11, and Koch's point of error 14, allege error by the trial court in concluding that all plaintiffs (appellees) were payees as defined by TEX. NAT.RES.CODE ANN. § 91.401(1) (Vernon 1993), which states: "Payee means any person or persons legally…”
Prize Energy Resources, L.P. v. Cliff Hoskins, Inc., 345 S.W.3d 537 (Tex. App. 2011). · cites it 3× “See Tex Nat. Res.Code Ann. §§ 91.401, 91.402.”
Coleman v. State, 131 S.W.3d 303 (Tex. App. 2004). · cites it 2× “See Tex. Nat. Res.Code Ann. § 91.401(2) (Vernon 2001); see also Koch Oil Co.”
ConocoPhillips Co. v. Koopmann, 547 S.W.3d 858 (Tex. 2018). “Laws 966 (codified as amended at TEX. NAT. RES. CODE §§ 91.401 -.406), at a time when payment schedules were not included in leases: Current law is totally vague as to deadlines for royalty payments.”
Concord Oil Co. v. Pennzoil Expl. & Prod. Co., 966 S.W.2d 451 (Tex. 1998). · cites it 2× “TEX. NAT. RES.CODE § 91.401(1)-(2). As an owner of an interest in the minerals, Concord has a legal right to compensation for oil and gas that has been produced from Survey Sixty-four and is a "payee.”
EOG Resources, Inc. v. Wagner & Brown, Ltd., 202 S.W.3d 338 (Tex. App. 2006). “Tex. Nat. Res.Code Ann. § 91.401 et seq. (Vernon 2001).”
ConocoPhillips Co. v. Ramirez, 534 S.W.3d 490 (Tex. App. 2017). “[and] that it is not necessary, if not impossible, to segregate time and labor invested pursuing the claims under the Texas Natural Resources Code § 91.401 thru [sic] 91.”
Heritage Resources, Inc. v. NationsBank, 895 S.W.2d 833 (Tex. App. 1995). “Tex.Nat.Res.Code Ann. § 91.401(2) (Vernon 1993).”
Mattalino v. Trinity Petroleum Expl., 927 F. Supp. 986 (S.D. Tex. 1996). “Tex.Nat.Res.Code Ann. § 91.401(3) (1978).”
Gloria Garcia v. Genesis Crude Oil L.P. (Tex. App. 2016). · cites it 2× “54546000, as defined by the Texas Natural Resources Code, Section 91.”
— Tex. Nat. Res. Code § 91.401(1) — 8 cases
Prize Energy Resources, L.P. v. Cliff Hoskins, Inc., 345 S.W.3d 537 (Tex. App. 2011). “See Tex Nat. Res.Code Ann. §§ 91.401, 91.402.”
Koch Oil Co. v. Wilber, 895 S.W.2d 854 (Tex. App. 1995). “Tesoro's points of error 10 and 11, and Koch's point of error 14, allege error by the trial court in concluding that all plaintiffs (appellees) were payees as defined by TEX. NAT.RES.CODE ANN. § 91.401(1) (Vernon 1993), which states: "Payee means any person or persons legally…”
Concord Oil Co. v. Pennzoil Expl. & Prod. Co., 966 S.W.2d 451 (Tex. 1998). “TEX. NAT. RES.CODE § 91.401(1)-(2). As an owner of an interest in the minerals, Concord has a legal right to compensation for oil and gas that has been produced from Survey Sixty-four and is a "payee.”
— Tex. Nat. Res. Code § 91.401(2) — 7 cases
Koch Oil Co. v. Wilber, 895 S.W.2d 854 (Tex. App. 1995). “Tesoro's points of error 10 and 11, and Koch's point of error 14, allege error by the trial court in concluding that all plaintiffs (appellees) were payees as defined by TEX. NAT.RES.CODE ANN. § 91.401(1) (Vernon 1993), which states: "Payee means any person or persons legally…”
Coleman v. State, 131 S.W.3d 303 (Tex. App. 2004). “See Tex. Nat. Res.Code Ann. § 91.401(2) (Vernon 2001); see also Koch Oil Co.”
Heritage Resources, Inc. v. NationsBank, 895 S.W.2d 833 (Tex. App. 1995). “Tex.Nat.Res.Code Ann. § 91.401(2) (Vernon 1993).”
In re: MTE Holdings LLC (D. Del. 2023).
— Tex. Nat. Res. Code § 91.401(3) — 5 cases
Mattalino v. Trinity Petroleum Expl., 927 F. Supp. 986 (S.D. Tex. 1996). “Tex.Nat.Res.Code Ann. § 91.401(3) (1978).”
Gloria Garcia v. Genesis Crude Oil L.P. (Tex. App. 2016). “54546000, as defined by the Texas Natural Resources Code, Section 91.”
— Tex. Nat. Res. Code § 91.401(l) — 1 case
Concord Oil Co. v. Pennzoil Expl. & Prod. Co., 966 S.W.2d 451 (Tex. 1998). “TEX. NAT. RES.CODE § 91.401(1)-(2). As an owner of an interest in the minerals, Concord has a legal right to compensation for oil and gas that has been produced from Survey Sixty-four and is a "payee.”
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