AMENDMENTS TO TITLE 11 OF THE UNITED STATES CODE.

SEC. 3017. AMENDMENTS TO TITLE 11 OF THE UNITED STATES CODE. (a) Definition.— Section 101 of title 11, United States Code, is amended by inserting after paragraph (21) the following: “(21A) ‘farmout agreement’ means a written agreement in which— “(A) the owner of a right to drill, produce, or operate liquid or gaseous hydrocarbons on property agrees or has agreed to transfer or assign all or a part of such right to another entity; and “(B) such other entity (either directly or through its agents or its assigns), as consideration, agrees to perform drilling, reworking, recompleting, testing, or similar or related operations, to develop or produce liquid or gaseous hydrocarbons on the property;”. (b) Property of the Estate.— Section 541(b) of title 11, United States Code, is amended— (1) in paragraph (2) by striking “or” at the end, (2) in paragraph (3) by striking the period at the end and inserting “or”, and (3) by adding at the end the following: “(4) any interest of the debtor in liquid or gaseous hydro-carbons to the extent that— “(A) the debtor has transferred or has agreed to transfer such interest pursuant to a farmout agreement or any written agreement directly related to a farmout agreement; and “(B) but for the operation of this paragraph, the estate could include such interest only by virtue of section 365 or 544(a)(3) of this title. Paragraph (4) shall not be construed to exclude from the estate any consideration the debtor retains, receives, or is entitled to 106 STAT. 3131receive for transferring an interest in liquid or gaseous hydro-carbons pursuant to a farmout agreement.”. (c) Effective Date-Application of Amendments.— (1) Except as provided in paragraph (2), the amendments made by this section shall take effect on the date of the enactment of this Act. (2) The amendments made by this section shall not apply with respect to cases commenced under title 11 of the United States Code before the date of the enactment of this Act.