Let’s take a look at what President Trump has done for the oil industry in his first year (This is not about decorum, dossiers, tweets, or Oprah’s inauguration.) As in the past, I refer to sources whose opinions and insights are more knowledgeable than mine.
No More “Sue and Settle”
Continue Reading Trump and the Oil Patch One Year In
Gloria’s Ranch v. Tauren et al – the Louisiana lenders’ bad dream
Anyone seeking stability in the law governing E&P activities in Louisiana will view the lower court decision as a grave error that must be corrected. Virtually every mortgage provides safeguards to protect collateral and manage lenders’ risk. The court of appeal reasoned that because of those provisions, the lender controlled the ability of the borrower to execute a release of a mineral lease, resulting in solidary liability when the borrower-lessee failed to release its lease.
Continue Reading An Oil and Gas Case to Expect From Louisiana, and Another From Texas
Once again we look back at the continuing cavalcade of crooks, criminals, miscreants and, to put it kindly, morons the less intellectually gifted, who met justice face-to-face in 2017. This year’s class includes a preacher, a controller, an engineer, a landman, and two lawyers!
Continue Reading 2017’s Bad Guys in Energy
Co-author Chance DeckerThe Texas Supreme Court recently heard oral argument in three intriguing oil and gas cases. Here’s what you need to know about two of them (We’ll address the third case soon).
Adams v. Murphy Exploration & Production Co. USA
Did lessee Murphy comply with an offset-well clause that doesn’t state where the offset-well must be drilled? When a well was drilled on an adjacent tract, Murphy drilled its offset-well more than 2,000 feet from the triggering well.
Continue Reading Opinions to Expect From the Texas Supreme Court
To begin, choose from these candidates for the all-world spendthrift hall of fame:
In Bradley v. Shaffer, Darrell, a beneficiary of a mineral trust established by his grandparents, purported to convey to Bradley his mineral interests that were subject to the trust and any interest held in trust that he might acquire in the future. The trustees sued, alleging that Darrell had no authority to convey his beneficial interest. Bradley argued that an extension of the trust violated the Rule Against Perpetuities. Spoiler: It didn’t.
A primer on Texas trust law … who owns what and other rules:
Continue Reading Mineral Conveyance Thwarted by a Spendthrift Provision
Co-author Trevor Lawhorn*Kind of; this is a federal court predicting what the Ohio Supreme Court would do.
In Ohio, in calculating royalties in a market-value-at-the-well lease (as distinguished from a “proceeds” lease), post-production costs are to be shared proportionately by the working interest and royalty owners. The lessee’s duty to market does not extend to expenses incurred in sales not at the well-head. This is consistent with other producing states such as Texas and Pennsylvania.
Continue Reading Ohio Takes a Position on Market-Value-at-the-Well Royalty Clauses*
Would you trust your $12 million arbitration to accountants rather than lawyers? Sometimes it makes sense. In_Apache v. YPF SA, delegating an accounting dispute to accountants was right. The problem was in the procedures and protections for a party believing the accountants got it wrong.
Continue Reading A Twist in Oil Patch Arbitration
Lukewarm apology: the headline is clickbait. This post is all about the whiskey, not the oil.
In my quest for the perfect Sazerac (as reported here and here) I’ve concluded that perfection is on the palate of the beholder. From this moment on I will refrain from declaring whether a particular offering is good, bad or indifferent. I’m a guidepost, not your conscience. Quid pro quo: Don’t tell me which King I should prefer: Albert, Freddie or BB.
Continue Reading Searching for Oil … and a Sazerac
Let’s suppose that someone (You? The other guy?) who operates wells in which others have an interest organizes the enterprise so that the owner of the leases, the owner of the overrides, the operator, several service companies, the employer of the workers, and on-an-on are all separate entities. Money is owed, liability is alleged, litigation
Cases like Hahn v. Gips et al are like eating your broccoli – not so tasty but lots of fiber. The “fiber” here is the effect of a partition deed in which not all the cotenants join.
Continue Reading A Partition Deed Fails in Texas