In TotalEnergies E&P USA, Inc. v. MP Gulf of Mexico LLC. the Supreme Court of Texas resolved the chaos created by conflicting dispute resolution regimes in three contracts for ownership and operation of an offshore unit and gathering system. The essential question: Did the parties agree that an arbitrator, rather than the courts
Insurance Coverage Not Limited by a Texas Service Agreement
As you negotiate your master service agreements are you confident that you know how insurance choices might affect indemnity obligations? Me neither. That’s why I turn to my Gray Reed partner Darin Brooks and his insurance coverage lawyers. I didn’t consult them about this post so all errors are on me, not them.
More Force Majeure Fallout From Uri
MIECO, LLC v. Pioneer Natural Resources presented a challenge to a force majeure defense in a dispute arising from Winter Storm Uri. The defense carried the day.
MIECO agreed to purchase 20,000 MMBtu/day of natural gas from Pioneer. Pioneer delivered residue gas from the tailgate of a Targa processing plant to two points near the…
Texas Supreme Court Rules on “Bespoke” Add-Back Royalty Clause
In Devon Energy Production Company, LP et al v. Sheppard et al, the Supreme Court of Texas construed what it referred to as a “bespoke” and “highly unique” royalty clause in several oil and gas leases to prohibit the producers from deducting out of the lessor’s royalty post-production costs incurred downstream of the point of…
Long-Running Texas Boundary Dispute Continues
Ellison v. Three Rivers Acquisition LLC et al., on remand from the Texas Supreme Court, is the third round of a boundary dispute between mineral lessees in Irion County.
For the history of Ms. Ellison’s odyssey from court to court to court, see our 2019 post discussing the first Court…
An Asset is an “Asset” Whether or Not BOEM Consents
Co-author Travis Nadalini
The negotiators and scriveners of the purchase and sale agreement in Matter of PetroQuest Energy, Incorporated would have been well served to consider all the potential ramifications, however remote, flowing from the definitions in their agreement. (Potential reply: “Who woulda thunk THAT would happen?”)
The Fifth Circuit, applying Louisiana law, held that…
LOIA Does Not Apply to a Salt Mine Operation
The issue in QBE Syndicate 1036 v. Compass Minerals Louisiana, LLC was whether the scope of the Louisiana Oilfield Indemnification Act applies to operations involving salt mining?
QBE issued a commercial general liability insurance policy to FSS and MC Electric. Clements, an employee of MC Electric, was electrocuted while working in the Cote Blanche salt…
Oops! Sellers Didn’t Read The Mineral Deed Before Signing
Precious little legal analysis is required to grasp the lesson from Springbok Royalty Partners v. Cook. No mode or manner of legal gymnastics is likely to save parties from the legal effect of a contract they didn’t bother to read before they signed it.
Following a lengthy conversation between the Cooks and a…
Market Value at the Well Trumps Free-Use Clause
Co-author, Gray Reed partner Jim Reed
The common thread throughout the myriad oil and gas royalty cases decided recently by Texas courts could be “harmony”, the reading of different, seemingly conflicting, contract provisions so as to give meaning to all.
In Enervest Operating, LLC v. Mayfield and Ingham the Fourth Court of Appeal harmonized a…
Arbitration Over Offshore Leases Does Not Warrant Lawsuit Dismissal
Co-author Justin Cowan
Just because parties agree that disputes over a contract will be subject to binding arbitration doesn’t mean there won’t be wrestling at the courthouse beforehand. In LLOG Exploration Offshore, LLC v. Samson Contour Energy E&P, LLC, the United States District Court for the Eastern District of Louisiana resolved a motion to compel arbitration and to dismiss a lawsuit by staying the litigation pending the outcome of the arbitration but not dismissing the case.
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