Davenport v. EOG Resources, Inc. is an appeal of a temporary injunction. The title tells you the result.
Davenport owned four tracts comprising 5,000 acres in Webb County that were originally part of a larger tract burdened by the 1967 Garner oil and gas lease. EOG has operated the lease since 1999 and its chief point of entry had been the Krueger Road gate on the east side of the ranch. In 2022 Davenport and EOG negotiated a water purchase agreement allowing a large frac pond and for EOG to purchase fresh water and have the right of ingress and egress on designated roads for the purpose of taking the water.
EOG informed Davenport of its plans to drill new wells and to access the ranch from the west via a new gate using a new road. Davenport objected and sued, arguing that EOG already had access to the proposed sites via Krueger Road, and if a road was needed there was a better route.
EOG’s witnesses at the temporary injunction hearing testified:
- The unpaved Krueger Road with its four wooden bridges and below-grade water crossings could not support the heavy equipment needed for its planned nine 12-well pads and associated production facilities.
- EOG had been accessing the Garner lease from an adjacent ranch north and west of the Davenport Ranch.
- EOG planned new roads would run primarily east-west across the northern portion of the ranch.
- Irreparable injury would occur because of unrecoverable loss of hydrocarbons based the delay in offsetting production.
Davenport’s witnesses testified:
- EOG did not express any concerns about Krueger Road
- EOG had been running large trucks and other equipment over that road and the wooden bridges with no problem.
- EOG’s planned route for the new road would damage a new asphalt road and waterlines running across his property.
- The new entrance is visible from his home, and
- He was concerned about the safety of his children from passing vehicles.
Davenport argued that in the water agreement EOG agreed to use the Krueger Road gate. EOG responded that the agreement pertained only to activities in getting water from the frack pond and relied on its pre-existing rights of access under the Garner lease.
The trial court found that Kreuger Road was not capable of sustaining EOG’s operations and enjoined Devonport from interfering with EOG’s access to the ranch. The status quo ante was EOG’s previously unhindered access to the ranch for its oil and gas operations.
The purpose of a temporary injunction is to preserve the status quo of the litigation’s subject matter pending a trial on the merits. To prevail on an application three elements must be pled and proven:
- a cause of action against the defendant
- a probable right to the relief sought, and
- probable imminent and irreparable injury in the interim.
The court of appeals cannot overrule a trial court’s decision unless the trial court acted unreasonably or in an arbitrary manner without reference to guiding rules or principles. That is a high hurdle for any appellant.
EOG proved all three elements: its cause of action under the oil and gas lease, a probable right to recover because the trial court gave greater weight to the credibility of EOG’s witnesses, and EOG needed to timely develop planned facilities and forcing it to access the ranch through the Krueger Road gate would delay or deny development which would harm future production, the reservoir damage could be permanent, and hydrocarbons could be irretrievably lost. Thus, damages would be difficult if not impossible to calculate.
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