Chesapeake Exploration, L.L.C. v. Hyder is another hair-splitting Texas decision about “cost-free royalties”.
The Facts
The Hyder family executed a lease covering 1,037 acres. Chesapeake drilled 22 wells on the leased premises. The Hyders believed their lease provided for a “cost free” royalty; that is, no post-production deductions. Chesapeake deducted post-production
Co-author Ann WeissmannThe Dietz family sued several lessees for injunctive relief and restorative damages arising out of leases on two non-contiguous tracts in Acadia Parish. In Dietz, et al. v. Superior Oil Company, et al the trial court granted the lessees’ dilatory exceptions of prematurity and improper cumulation and dismissed the plaintiff’s suit without
O
h, how a simple Favored-Nations clause in an oil and gas lease can get complicated, with large financial consequences! In BP America Production Company v. Zaffirini, BP paid Solis a $1,300 per acre bonus for a lease covering 30% of the mineral estate and agreed that if paid a more favorable
Vestiges of the early Haynesville Shale land rush remain.
Imagine: The lease is about to expire. Lessee (Mecom) offers lessor (Henderson) $90 per acre for an extension, telling him, “I could extend for two more years without consent so I’m giving you free money.” He explains his intention to drill more Cotton
The fellow on the right is after your lease. The result in Cabot Oil & Gas Corporation v. Healey, LP was so bad for the lessee I’m going directly to …
The Takeaways
Landmen: First, when offered a lease with automatic termination language, run away like you’re chased by an Obamacare Navigator who hasn’t undergone
Consider this while celebrating the resurrection of Big Tex: When a lease prohibits post-production cost deductions, can a lessee deduct those costs from a lessor’s royalty? Yes, says Potts v. Chesapeake Exploration, L.L.C. In a market value lease, where lessee sells the gas “at the well” and the court applies the netback approach to calculating
Lawyers and landmen are taught that a document affecting real or immovable property not recorded in the public records means nothing to a stranger. Like O. J.’s quest for the real killer, lower premiums after the Patient Protection and Affordable Care Act, and the present I would have given my wife except I forgot our
Occasionally in my litigation experience I’m reminded of time-honored rules of law. Often I’m pleased, sometimes I’m not. So it was, I assume, for the parties in Midnight rilling, LLC v. Triche et al .The Rules
In Louisiana
PanAmerican Operating Inc. v. Maud Smith Estate highlights the perils of working through independent landmen: maintaining enough control to be sure the work is done as you like it, but also wanting authority to disavow his actions should you desire.
PanAmerican hired an independent contractor, Wormser, to obtain oil and gas leases
Ross et al v. Enervest Operating, L.L.C. et al has several teachable moments for Louisiana royalty owners.
“Nice to Meet You” is Not a Demand
Under the Louisiana Mineral Code, a lessee is entitled to written notice from the lessor that royalties are due. The court concluded that such a notice must be more than