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Contract Interpretation Oil & Gas Business Litigation

Gray Reed

Ambiguity Frees Louisiana Royalty Owner From Post-Production Costs

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In Franklin v. Regions Bank the Fifth Circuit concluded that a royalty clause in a mineral lease resulted in a gross proceeds royalty; the royalty owners did not bear their proportionate share of post-production costs. Read...more

McGinnis Lochridge

Plain Language Meets Common Sense: Hidden Traps in Oil Patch Contract Interpretation

McGinnis Lochridge on

What happens when a court reads your contract literally for one issue but decides what 'makes sense' for another? A geophysicist just found out. In early April 2025, the Amarillo Court of Appeals reversed in part and...more

Gray Reed

Two Words = Six Million Dollars: SCOTX Reverses Trial Court That Added Words to a Gas Transportation Agreement

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In American Midstream (Alabama Intrastate), LLC v. Rainbow Energy Marketing Corporation, the Texas Supreme Court held that the trial court improperly inserted the words “scheduled” and “physical” into a contract. By...more

McGinnis Lochridge

Supreme Court of Texas Washes Out the “Anadarko Washout”

McGinnis Lochridge on

The so called “Anadarko Washout” involves a washout of oil and gas leases on undivided working interests owned by non-operating mineral cotenants. This particular species of lease washouts is based on two recent cases from...more

Gray Reed

Operator Excused from Texas Relinquishment Act Claims

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In Williams O & G Resources, LLC v. Diamondback Energy, Inc., a federal magistrate judge concluded that the Texas Relinquishment Act does not apply to public-school lands patented after 1931. The report and recommendation was...more

Gray Reed

Texas Pore Space Ownership – Royalty Calculation

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In Myers-Woodward, LLC v. Underground Services Markham, LLC et al, (discussed previously) the parties disagreed on how to calculate Myers’ royalty on salt produced by Underground....more

Baker Botts L.L.P.

Write it Down or Forever Hold Your Peace: Texas Supreme Court Rejects Fraud Claims Based on Oral Representations in Mineral Deals

Baker Botts L.L.P. on

On Friday, May 9th, the Supreme Court of Texas addressed important issues regarding the enforcement of written contractual representations in its per curiam opinion styled Roxo Energy Co., LLC et al. v. Baxsto, LLC, ---...more

McGinnis Lochridge

All Depths or Just One Formation? Court Clarifies Royalty Conveyance in Rock River v. Pioneer

McGinnis Lochridge on

This recent case (Rock River Minerals, LP v. Pioneer Nat. Res. USA Inc., No. 08-23-00216-CV, 2024 WL 4528917 [Tex. App.—El Paso Oct. 18, 2024, no pet. h.]) explored whether an assignment of an overriding royalty interest,...more

McGinnis Lochridge

Can "Free of Cost" Term Achieve Point-of-Sale Royalty Base?

McGinnis Lochridge on

A lessee who halts production for less than 40 days and resumes without drilling or reworking does not terminate the lease. The continuous development clause keeps the lease active, and the cessation clause allows resumed...more

Porter Hedges LLP

Business Litigation Alert: "Texas Supreme Court Ruling Highlights the Importance of Heeding 'Red Flags' During Pre-Contract...

Porter Hedges LLP on

Last month, the Texas Supreme Court upheld a lower court’s decision to toss a lawsuit by Orca Assets GP LLP against JP Morgan Chase over property in the Eagle Ford Shale. ...more

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