Co-author Chance Decker
In Murphy Exploration & Production Co. — USA v. Adams the Texas Supreme Court held that an offset well clause in an oil and gas lease did not require the lessee to drill wells calculated to protect against drainage. Four dissenting justices believed the majority disregarded the well-established meaning of “offset well” used in the oilfield for decades.
Continue Reading Texas Supreme Court Redefines an Offset Well Clause
Co-author Brittany Blakey*
A few things you should know about the acreage retention clause:
Two Texas Supreme Court decisions published on the same day confirm that retained acreage clauses that vary in language from one instrument to another will likely vary in effect. Depending on the language, the lessee might not be able to maintain all the acreage it planned on holding.
Continue Reading Ask and You Shall (Not?) Receive: Retained Acreage Clauses and the Texas Supreme Court
The question posed in our recent discussion of Devon Energy v. Apache Corporation was the meaning of “payor” under the Texas Division Order Statute. The answer, as far as it went, was that in a well drilled without a joint operating agreement the statute does not require the operator to pay lease royalties to
It is often a worthy strategy for the lessee to be aggressive with counterclaims against the lessor. Or how about we’re the Wehrmacht and the other guy is Poland.
Lessees should think twice about that strategy if it means complaining about the lessor’s public statements. In Lona Hills Ranch v. Creative Oil & Gas Operating LLC et al, that strategy ran afoul of the Texas Citizens Participation Act, Texas’s “anti-SLAPP” statute (“Strategic Lawsuits Against Public Participation”).
The TCPA authorizes dismissal of a legal action based on, relating to, or in response to a party’s exercise of the right of free speech, right to petition, or right of association.
Continue Reading Texas Anti-SLAPP Statute Stalls Lessee’s Counterclaim
There are specific requirements for proving that an oil and gas lease has survived past its primary term. Fail to hit them all when the lease is challenged at the courthouse, and disappointment will be order of the day.
The heart of the dispute in J&L Oil Company v. KM Oil Company was whether plaintiff J&L satisfied the requirements of a Pugh clause in a 1951 lease. J&L sued KM for impinging upon J&L’s lease on 55 acres in Caddo Parish, Louisiana. Summary judgment in favor of KM, the alleged impinger, was affirmed.
Continue Reading Lack of Proof Dooms Pugh Clause Defense
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
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*
What does it take these days to get money from a Texas jury? Not much, it seems; in XTO v. Goodwin the trick was convincing a higher court that you should keep it.
Let’s start with the minefield that is the law of evidence:
Updated for a math infraction, thanks to several astute readers.
In Glassell Producing Company v. Naquin, the question was:
Did a conveyance among siblings create a real right in property, or was it an appendage of a lease that ceased to burden the property once that lease was terminated?
Continue Reading An “Appendage” Determines a Louisiana Royalty Dispute
Co-author Chance DeckerHow many times must an operator suffer for a mistake in a unit declaration? Samson Exploration LLC v. T. S. Reed Properties Inc. makes it twice. (See Hooks v. Samson Lone Star for the first round). The Texas Supreme Court ruled that a lessee could not avoid a contractual obligation to pay royalties from a zone shared by two pooled units.
Continue Reading Unit Operator Pays For a Problem of its Own Making
