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Energy & the Law

Charles Sartain

Posts by Charles Sartain

The Parol Evidence Rule at Work in a Mineral Transaction

Posted in Contract Disputes, Land Titles, Title Issues

A phrase currently in common usage begins with “‘cluster” and ends with a vulgarity that has been around for centuries. Saheid v. Kennedy presents facts that pretty much exemplify the meaning of the phrase: While living in England, start out to buy a hotel in New Orleans, have no experience in Louisiana mineral transactions, when the… Continue Reading

Mineral Lease Prevails in Louisiana Royalty Dispute

Posted in Lease Disputes, Regulations, Royalty Disputes

Co-author Brooke Sizer Prevails over what, you ask? In Gladney v. Anglo-Dutch Energy, LLC, a conditional allowable from the Office of Conservation didn’t supersede lease royalty obligations. How did we get here? Anglo-Dutch completed a gas well on the Gladneys’ lease and then filed a pre-application notice for a compulsory drilling and production unit and applied… Continue Reading

Oil and Gas Arbitration – Did the Parties Get What They Bargained For?

Posted in Contract Disputes, Litigation

First, a promise: I won’t report on another arbitration case until there is more to say than “business as usual”. Second, an opinion: Arbitration is still the right forum in many situations. Third, remember: An award and a result, not litigation, was what Venoco says it bargained for. That said, knowing only that Denbury Onshore v. Texcal Energy South Texas is… Continue Reading

What Price For a Louisiana Servitude?

Posted in pipelines

According to Enterprise Te Products Pipeline Company v. Avila, it is the value of the expropriated property, even if it is as little as 33 cents each to the landowners. This seemingly small case must have had big potential for chaos. Otherwise, why appeal? Enterprise sought expropriation of a 30-foot wide servitude over the Avilas’… Continue Reading

Oil Industry Custom and the Model Form JOA: A Debate

Posted in Contract Disputes, Operating Agreements, operations

We begin with an existential question: “The philosophy behind all of the model form agreements is that aggressive drilling under the JOA should be promoted and rewarded. Agree or disagree? That was an issue in Talisman Energy v. Matrix Petroleum.  It was not resolved, but the decision is worth your attention because the court enjoined… Continue Reading

It’s Now Easier To Be a Common Carrier Pipeline in Texas

Posted in Eminent Domain, pipelines

We now know what it takes to establish common carrier pipeline status in Texas.  According to the Texas Supreme Court in Denbury Green Pipeline Texas LLC v. Texas Rice Land Partners Ltd., all that is required is a reasonable probability that the pipeline will, at some point after construction, serve the public by transporting a product for one or… Continue Reading

The Constructive Notice Doctrine in Action

Posted in Land Titles, Title Issues

Today’s “pay attention” edition begins with a quiz. What is the most important thing to read carefully: a. Speed limit sign in small-town (insert name of Southern state). b. Itinerary for that dream vacation, the one with multiple layovers of varying durations in airports and time zones far from your own. c. Title documents to which you affix… Continue Reading

2016 – A Bad Year For Bad Guys in Energy

Posted in Regulations, Statutes

Let’s look back at a cavalcade of crooks, criminals and miscreants who met up with justice in 2016.  We do it to be reminded of the others who will be lurking in the 2017 shadows. Perp: David Kent, founder of Oilpro.com Offense: Wire fraud by computer hacking. How: Created a “backdoor entry” into the computer system of Rigzone  (the company he founded and sold… Continue Reading

Have You Reviewed Your Lease Maintenance Processes Lately?

Posted in Contract Disputes, Litigation

You might conclude that the but-for-the-grace-of-God-that-could-be-me nightmare presented in In re: RPH Capital Partners is instructive only for lawyers. If so, you would be mistaken. The lesson: If you want to win the lawsuit, pay attention to pesky legalities such as notices of trial settings. Likewise, if you want to protect your hydrocarbons, reinforce your people and processes for… Continue Reading

Your Louisiana Override – Where Does it Come From?

Posted in Land Titles, Royalty Disputes

It’s a multiple choice question: a.  The royalty interest reserved by the lessor. b. The drillbit, courtesy of fearless, risk-taking entrepreneurs, the backbone of the great American free enterprise system and the sworn enemies of collectivism. c.  A cache of DNC emails, discovered by Vladimir Putin himself. d.  The working interest. e. It doesn’t matter. Trump won. Get over it. Can’t… Continue Reading

Arbitration in Louisiana – Another Budding Romance?

Posted in Contract Disputes, Litigation

Are Louisiana courts as enamored with arbitration as their Texas counterparts? Looks like it. East of the Sabine, submitting your dispute to arbitration means you are pretty much saying adieu, farewell and bye-bye to a judicial mulligan. In ExPert Oil & Gas, LLC v. Mack Energy Co., et al an arbitrator’s mistaken calculation did not nullify an arbitration award. Round one ExPert… Continue Reading

The Rule Against Perpetuities is Alive and Enforceable in Oklahoma

Posted in Contract Disputes, Land Titles

Today we venture into Oklahoma, to be instructed on the Supreme  Court’s treatment of the Rule Against Perpetuities. First, the Rule: No property interest is good unless it must vest, if all, not later than 21 years after some life in being at the creation of the interest. In American Natural Resources LLC v. Eagle Rock Energy Partners LP,… Continue Reading

Operator – Don’t Get Burned by Paying an Insolvent Contractor

Posted in Land Titles, operations, Title Issues

MEMORANDUM From: Legal Department To: Accounts Payable Re: What we learned from Shell Western E&P, Inc. v. Pel-State Bulk Plant, LLC ________________________________________________________________________ Just received notice of a Texas subcontractor’s mineral lien? DO NOT continue to pay the contractor. He hasn’t paid the subcontractor. Think you owe nothing on the well on which the lien will… Continue Reading

What Your New President Will Do For or To You

Posted in Energy Policy, Environmental Policy

We begin with a Rorschach test. As the big election day approaches, which candidate do you see in the photograph? Discuss among yourselves. Get ready for lots of musical interludes. The nation’s despair runs deep and wide, so profound that it cannot be expressed in mere words. What do they promise? Let’s look at what we might expect from… Continue Reading

Texas Courts Continue Their Romance With Arbitration

Posted in Contract Disputes

The lessons in Craddick Partners Ltd. v. EnerSciences Holdings, LLC are three: Parties who have not signed an agreement to arbitrate have standing to compel arbitration; artful pleading to avoid arbitration won’t work; and Texas courts remain eager to send cases to arbitration. EnerSciences’ two subsidiaries sell products in the oil field. Tom Craddick approached EnerSciences to sell products… Continue Reading

Louisiana Statutory Penalties Imposed on Operator

Posted in Legislation, Litigation, Pooling and Unitization

If you’ve ever tried to escape penalties for the operator/producer’s failure to comply with La. R.S §30:103.1 and §103.2, take comfort in XXI Oil & Gas, LLC v. Hilcorp Energy Company.  You are not alone. No excuse has satisfied the courts, and there is none here. The statutes (links above) require information and certain procedures… Continue Reading

Texas Tax Ruling Favors Frac Trailer Owners

Posted in Regulations

Co authors David Leonard and Austin Carlson If you were able to keep your frac trailers from the clutches of your avaricious creditors during the past several unpleasant years, you could be in luck. Owners and lessors of frac trailers may be entitled to a refund for sales tax paid in connection with the purchase,… Continue Reading

Methane Emissions Standards Take Effect

Posted in Climate Change, Environmental Policy, Regulations

Effective this past August 3, the EPA has new regulations for methane and volatile organic compound emissions from oil and gas operations  As you know, reducing methane emissions is a key component of the President‘s climate change agenda. Why should I care? Because if you own or operate an oil and gas production, processing, transmission or… Continue Reading