Texas is becoming a critical-minerals state. Watch the Railroad Commission.

In the first piece in this series I said that capital, resources, and technology were converging in Texas. The capital part played out on the Texas Stock Exchange this month. The resources part is playing out more quietly, in a strip of Northeast Texas between Sulphur Springs and Texarkana, and the agency that will decide how it goes is not an exchange or a legislature. It is the Railroad Commission of Texas — which has a seat on the ballot on November 3 and a Legislature convening on January 12 that still has not answered the most basic question in the industry: who owns the lithium.

The resource is real, and it is now priced

On September 8, Smackover Lithium — the 55/45 partnership between Standard Lithium and Equinor — published a preliminary economic assessment for its Franklin Project across eastern Hopkins, Franklin, and western Titus counties. The numbers are the first serious public price tag on Texas lithium: brine grades starting at 562 milligrams per liter, the highest reported in North America; up to 70,000 tonnes a year of battery-quality lithium carbonate over a twenty-year life; an after-tax net present value of about $5 billion on $3.5 billion of initial capital; roughly 76,000 acres under brine lease today. A pre-feasibility study is targeted for 2027, first production for the early 2030s. Their first project, across the state line in Southwest Arkansas, is preparing a final investment decision before the end of this year.

They are not alone. ExxonMobil's Saltwerx and Chevron hold Smackover positions on both sides of the state line; TETRA Technologies has a producing bromine unit in Arkansas; EnergyX is running direct-lithium-extraction equipment at Hooks, in Bowie County, on former Red River Army Depot land, and in May a Texas congressional delegation filed a bill to let private operators produce lithium beneath the depot itself. The Texarkana Chamber of Commerce held its first lithium symposium in July. Whatever one thinks of the electric-vehicle market in a given quarter, the Smackover is being developed on the timeline of a chemical plant, not a stock price, and the next five years will be spent on leases, permits, and ownership — which is to say on law.

What Texas has decided, and what it has not

Texas has done three things. In 2023 the Legislature gave the Railroad Commission jurisdiction over brine mining, and in February 2025 the Commission's Statewide Rule 82 took effect: a permit regime for brine production and spent-brine injection wells, with spacing and density rules borrowed from a century of oil and gas practice. In June 2025 the Supreme Court of Texas held in Cactus Water Services v. COG Operating that produced water from an oil and gas well belongs to the mineral lessee by default, as a waste product of the mineral estate — and said in a footnote that it was expressing no view on who owns the non-hydrocarbon minerals dissolved in it. And in November 2025 the EPA granted the Commission primacy over Class VI carbon-storage wells, a program the agency had been building since 2021 and that arrived with eighteen applications waiting; it is the clearest recent evidence that the Commission can take over a federal permitting program and run it.

What Texas has not done is the list that every lessor, operator, and lender in the Smackover is working around. The Legislature has not said whether lithium in a brine produced for lithium belongs to the mineral estate or the surface estate; a 2025 bill that would have placed "brine minerals" in the mineral estate died in the Senate Natural Resources Committee. There is no statutory unitization or pooling authority tailored to brine, so projects that need tens of thousands of contiguous acres are assembled lease by lease. There is no uniform royalty and no property-tax guidance; Arkansas set a 2.5 percent lithium royalty by order last year, and the Franklin economics simply assume the same figure. The spent-brine injection wells that make the whole process work are Class V wells that still answer to the EPA as well as to the Commission, because the federal program amendment that would put them fully in Austin's hands is not finished. And the water questions — whether brine is water, who holds the right to it, what happens to an aquifer when a project returns its brine to the same formation for twenty years — sit with the University of Texas Bureau of Economic Geology, which has told the Legislature to expect findings on water rights and royalties by the end of this year.

November 3: a six-year term over the whole build-out

One of the Commission's three seats is on the general-election ballot. The incumbent, Chairman Jim Wright, lost the May Republican runoff by about 14,600 votes to Bo French, who faces State Representative Jon Rosenthal, the Democratic nominee, and Libertarian Arthur DiBianca in November. Whoever wins serves through 2032 — which is, almost exactly, the window in which the first Texas lithium plants will be permitted, financed, built, and started up. It is the second time in six years that a sitting commissioner has lost a primary, and the race drew unusual money and attention for a Railroad Commission contest. I am not going to tell you how to vote. I am going to tell you what the winner inherits.

The winner inherits Rule 82 in its first full year of operation, with the first contested brine-permit questions — spacing exceptions, setback disputes, the line between a brine well and a geothermal injection well under Rule 46 — still ahead of it. The winner inherits the Class V primacy question and the staff that just stood up Class VI. The winner inherits the produced-water rules the 2025 Legislature ordered — land-application standards, treated-water rules, ten-year commercial disposal permits — at the moment produced water became a potential lithium feedstock. And the winner inherits an agency whose docket is still overwhelmingly oil and gas, in a year when oil and gas will want its regulator's attention on export markets, pipeline capacity, and power for data centers. How the next commissioner allocates hearing time, staff, and rulemaking priority between the industry that built the agency and the industry that is arriving is the single most important variable in Texas critical-minerals policy, and it is not written down anywhere.

January 12: what the 90th Legislature will be asked to do

Bills can be pre-filed beginning the Monday after the election, and the session opens on January 12, 2027. The interim hearings so far have been about hydrogen, geopolitical supply risk, oilfield theft, and inactive-well plugging; critical minerals were higher on the list two years ago than they are today, because data centers and the grid have consumed the oxygen. That is the opening. The brine-minerals ownership bill will come back, and it will decide whether the Smackover is leased from mineral owners or surface owners — a question worth more than the royalty rate itself, because it determines who the counterparty is. A brine unitization or pooling statute, modeled on the Mineral Interest Pooling Act, would let the Commission force-pool holdouts into a brine unit the way it does for oil and gas; expect developers to ask for it and landowners to resist. Royalty and property-tax clarity, water-rights language, and a statutory path to Class V primacy round out the list. Against that, the Legislature will hear from the oil and gas industry about the rules it added in 2025, and the Commission's weatherization and inactive-well enforcement will be tested by whatever the next winter brings.

What this means if you hold acreage, capital, or a permit

If you own minerals or surface in Hopkins, Franklin, Titus, Cass, Bowie, or the counties between them, the lease you sign before the Legislature acts will be construed under whatever the Legislature does — so the drafting choices in it, especially how it defines brine and what it reserves, matter more than they would in a settled field. If you are financing a project, the title work is not oil and gas title with a different mineral name; it has to run the brine question through the surface estate, the mineral estate, and Cactus Water at once, and your lender will ask. If you are an operator, the permit you file under Rule 82 this year is being filed into an agency that is about to change hands and a rule that has not yet been construed in a contested case. None of that is a reason to wait. It is a reason to build the record — leases, title, permits, unit agreements — as if it will be examined by a court, an exchange, and a new commissioner, because within six years it will be.

This is the first of several pieces on Texas critical minerals. Next: who owns the lithium — the surface-estate and mineral-estate arguments after Cactus Water, and what a lease should say in the meantime; then a practitioner's reading of Rule 82's spacing, setback, and exception provisions; then the brine-versus-geothermal line under Rule 46, which is where several of the most interesting projects in the state actually live.

Scott Beckmen is the Managing Partner of Windward Counsel, PC, a business law firm in Flower Mound, Texas, and leads the firm's Railroad Commission, lithium-brine, and geothermal work. This article is general information about Texas law and public developments as of its date, not legal advice about any tract, lease, project, or docket, and it does not describe any client matter. It takes no position on any candidate. Attorney advertising. Not certified by the Texas Board of Legal Specialization.

This article is general information about developments in Texas and federal law as of its publication date, not legal advice about any specific tract, lease, project, or offering. Laws and rules change; talk to counsel about your situation before acting. Attorney advertising.