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Contract Interpretation Oil & Gas

McGinnis Lochridge

Texas Supreme Court Rules on Modification of NPRIs

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In this recent case, the Texas Supreme Court resolved whether ratification of a lease or signing of a stipulation agreement could transform a fixed non-participating royalty interest (NPRI) into a floating NPRI....more

Gray Reed

Geophysicist’s Claims Turn on Definitions

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Sewak v. Sutherland Energy Co. Ltd. is of interest for how the court defined terms commonly used in consulting contracts in the oil and gas industry, and how difficult it is to foresee all contingencies when negotiating a...more

Oliva Gibbs LLP

Reservation or Limitation on Warranty? Navigating the Fine Line — Lessons from Valence Operating Co. v. Davidson

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In Valence Operating Co. v. Davidson1, the Court of Appeals for the Sixth Appellate District of Texas at Texarkana addressed whether the provision, “all Oil, Gas and other Minerals have been excepted and reserved by former...more

McGinnis Lochridge

Tackling Free-Use and At-The-Well Royalties

McGinnis Lochridge on

This lease royalty case involved a dispute over whether the lessee was permitted to deduct volumes of gas used off the premises to power post-production activities on other gas produced from the same well. Carl v. Hilcorp...more

Oliva Gibbs LLP

If the Lease Requires Notice, Then Provide Notice: Simple Enough?

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I. Background In the case of Kirkbride v. Antero Res. Corp., the Sixth Circuit Court of Appeals is faced with a novel argument on the interpretation of a condition precedent within an oil and gas lease. The case comes to the...more

Bradley Arant Boult Cummings LLP

Where Old Meets New: Energy Transition Projects Collide with Oil, Gas Law

Over the course of a century of oil and gas development in the U.S., a robust body of law developed, covering virtually every aspect of E&P and interpreting every provision in oil and gas leases, joint operating agreements...more

Gray Reed

“Harmony” in a Texas Mineral Reservation

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In Smart v. 3039 RNC Holdings LLC, the court reminds us that it will harmonize all parts of a contract, even one that “is not a model of clarity”, to reach the correct result. ...more

Bradley Arant Boult Cummings LLP

Contextual “Construction” of Force Majeure Clauses

The Texas Supreme Court recently provided new guidance in interpreting force majeure language in an oil and gas drilling dispute. In Point Energy Partners Permian, LLC v. MRC Permian Company, the court held that the oil and...more

Bradley Arant Boult Cummings LLP

You Can Stand Under My Umbrella (by Clearly Manifesting It)

In Texas, many master service agreements (MSAs) related to the oil and gas industry typically contain provisions related to mandatory minimum insurance coverage and indemnity obligations. The Texas Supreme Court recently held...more

Gray Reed

Texas Supreme Court Rules on “Bespoke” Add-Back Royalty Clause

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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...more

Gray Reed

Oops! Sellers Didn’t Read The Mineral Deed Before Signing

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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...more

Gray Reed

Texas Correction Deed Statute Revisited

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Those who continue to be horrified by Broadway National Bank, Trustee v. Yates Energy Corp. should be relieved that the result in Endeavor Energy Resources, LP v. Anderson was more equitable. In Yates, the Texas Supreme Court...more

Holland & Knight LLP

A Closer Look at Nettye Engler Energy, LP, v. BlueStone Natural Resources II, LLC

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The Supreme Court of Texas has once again tackled the heavily contested issue of postproduction costs in royalty calculations. In Nettye Engler Energy, LP, v. BlueStone Natural Resources II, LLC, No. 20-0639, the Court was...more

Gray Reed

Texas Court Accepts Only One Meaning of “Leased Premises” in an Oil and Gas Lease

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How many different meanings can parties attribute to a term in an oil and gas lease?  Answer: As many as they want, but the court will only use one, says King Operating et al v. Double Eagle Andrews, LLC et al....more

Gray Reed

Texas Court Rules on a Retained Acreage Clause

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Sometimes writing too many alternatives into an oil and gas lease invites confusion … which provokes litigation … which results in disappointment for somebody … or everybody. ...more

Gray Reed

Texas Court Addresses Anti-Washout Clause and Rule Against Perpetuities

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Yowell v. Granite Op. Co. and Apache Corp. v. Peyton Royalties, L.P. is another Rule Against Perpetuities case. Keep reading. The anti-washout protection for your reserved overriding royalty could be at risk....more

Gray Reed

Oil and Gas Lease Addendum Supersedes Printed Form

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In Apache Corp. v. Hill, et al.,  lessors prevailed in a lease construction dispute because of the court’s unsurprising conclusion that a typewritten addendum to oil and gas leases superseded conflicting provisions in the...more

Gray Reed

Texas Court Parses Three Retained-Acreage Clauses – Part 2

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Yesterday we discussed aspects of PPC Acquisition Co., LLC, et al. v. Delaware Basin Res., LLC, et al. Today we consider whether the retained-acreage clauses created a special limitation or a covenant and the relationship...more

Gray Reed

Texas Supreme Court Deems Continuous Development Clause Ambiguous

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In Endeavor Energy Resources, L.P. v. Energen Resources Corp. et al. the Supreme Court of Texas construed a continuous development clause in an oil and gas lease covering 11,300 acres in Howard County. After the primary term,...more

Gray Reed

Texas Court Evaluates Consent to Assign an Oil and Gas Lease

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In Mayo Found. For Med. Educ. & Research v. BP Am. Prod. Co. a United States District Court considered the circumstances under which a lessor can withhold its consent to assign an oil and gas lease....more

Gray Reed

Texas Supreme Court to Consider Continuous Development Clause

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The Texas Supreme Court has agreed to hear oral arguments in a dispute over an “accumulation” provision in a continuous development clause of an oil and gas lease.  The case is Endeavor Energy Resources L.P. v. Energen...more

BCLP

Joint Operating Agreements: What have we learned from the High Court’s decision in TAQA v Rockrose

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On Friday 17 January 2020, the High Court gave its judgment in the TAQA Bratani v Rockrose case (TAQA Bratani Ltd and others v. RockRose UKCS8 LLC [2020] EWHC 58 (Comm)). In this judgment, the Court held in favour of the...more

Bracewell LLP

JOAs: “Good Faith” and the implied qualification of express contractual powers

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There have been a number of recent English Court decisions concerning implied obligations of good faith. In May 2019, we considered the potential impact of those decisions on joint operating agreements in the oil & gas...more

Gray Reed

Fake Mineral Leases Thwarted by the Texas Legislature

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The 2019 Texas legislature enacted a new Property Code Section 5.152 to protect mineral and royalty owners from a certain species of fraudulent transactions perpetrated on trusting and/or naïve and/or out of state mineral...more

Gray Reed

Louisiana Operator’s Bad Faith Does Not Preclude Recovery

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Under Louisiana law, does the operator’s bad faith preclude recovery for the non-operator’s breach of a joint operating agreement if the operator caused the non-operator to breach the JOA but did not itself breach?...more

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