News & Analysis as of

Oil & Gas Bankruptcy Court

Offit Kurman

Fifth Circuit Confirms Third-Party Liens Survive Chapter 11 Discharge

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The Fifth Circuit has confirmed the old adage that liens “ride through” bankruptcy regardless of a discharge. Reversing a Texas bankruptcy court, the Circuit Court has held that a statutory privilege (a lien) against property...more

Bennett Jones LLP

Spartan Delta Appeal Raises Uncertainty for Co-Lessees After Insolvency

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Years after an insolvency proceeding is closed, can a solvent co-lessee/working interest participant (WIP) still be on the hook for their former partner’s share of unpaid Crown royalties? A recent Alberta Court of Appeal...more

Gray Reed

Bankruptcy Court Blocks GLO’s State Lease Termination

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In In re Pearl Resources LLC, a Houston bankruptcy court rejected the Texas General Land Office’s attempt to partially terminate state oil and gas leases in Pecos County, despite finding the operator had breached offset well...more

Gray Reed

Scribner’s Error: A Cautionary Tale of Oil & Gas Fraud

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DALF Energy, LLC v. GS Oilfield Services addresses a fiduciary’s deceptive actions in oil and gas transactions. The Fifth Circuit held: self-dealing may constitute a breach of fiduciary duty even when the principal is...more

Stikeman Elliott LLP

Recent Judicial Decision of Interest to Energy Lawyers

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Energy lawyers are frequently met with challenging legal issues within a rapidly changing regulatory and legal environment. It is essential to stay up to date on the latest caselaw from courts across Canada, and this article...more

Bennett Jones LLP

Supreme Court of Canada Dismisses Leave-on-Leave in Mantle Materials Group: The Priority of Environmental Obligations Extends...

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In late May, the Supreme Court of Canada (the SCC) denied an application for leave to appeal a decision of the Court of Appeal of Alberta (the ABCA), which, in turn, had denied leave to appeal of the decision of the Court of...more

Morgan Lewis

Delaware Bankruptcy Court Ruling on $7.2B Claim Affects Fraudulent Transfer Defense, Valuation Litigation

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In a decision likely to have a knock-on effect for future fraudulent transfer defense and valuation litigation, the Delaware bankruptcy court recently ruled that the price agreed in the sale of an oil and gas company closed...more

Patterson Belknap Webb & Tyler LLP

Equitable Mootness Applied Again: The Fifth Circuit Refuses to Hear an Appeal

The Fifth Circuit recently dismissed an appeal of a confirmation order as equitably moot. The decision was based on three key factors: the appellant hadn’t obtained a stay pending appeal, the plan had been substantially...more

Pillsbury Winthrop Shaw Pittman LLP

Fifth Circuit Reaffirms Bankruptcy Court Jurisdiction Over Rejection of FERC-Regulated Offtake Agreement

Public policy concerns associated with contracts impacted by energy industry bankruptcies filed in the Fifth Circuit will be resolved in bankruptcy court mini-trials instead of FERC proceedings. Parties entering energy...more

Jones Day

Delaware Court Holds Rejection Eliminates Non-Debtor's Exclusive Right to Provide Services to the Debtor

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Nine Point Energy Holdings, Inc. and its affiliates (collectively, "Nine Point" or "Nine Point debtors") constituted an oil and gas production and exploration company that sought to reorganize in chapter 11 through a going...more

Gray Reed

Delaware Bankruptcy Court Treats Royalty Owner Claims as Unsecured

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If you are a royalty owner and have questions about how your claim is likely to be treated when your lessee/operator goes into bankruptcy in Delaware, In re MTE Holdings LLC is a significant case....more

Morgan Lewis - Power & Pipes

Delaware Bankruptcy Court Finds Violation of the Automatic Stay with Reservation of Rights Letters Sent to Non-Debtors

US Bankruptcy Judge Mary F. Walrath of the District of Delaware entered an order on April 21 in In re Nine Point Energy Holdings, Inc., Case No. 21-10570 (MFW) (Bankr. D. Del. Apr. 21, 2021), finding that Caliber Measurement...more

Jones Day

Energy Sector Update: More Bankruptcy Courts Join the Fray in Dispute Over Rejection of Gas Gathering Agreements

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In a leading precedent handed down in 2018—Sabine Oil & Gas Corp. v. Nordheim Eagle Ford Gathering, LLC (In re Sabine Oil & Gas Corp.), 734 Fed. Appx. 64 (2d Cir. May 25, 2018)—the U.S. Court of Appeals for the Second Circuit...more

BakerHostetler

Bankruptcy Courts Contemplate Debtors' Rejection of Real Property Covenants in Midstream Contracts

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ver the past four years, midstream firms have struggled to adapt their long-standing practices and adjust their long-held expectations, which were fundamentally disrupted by the outcome of the landmark bankruptcy case, In re...more

A&O Shearman

Additional Guidance for Drafting Dedications: Delaware Bankruptcy Court Rejects Southland Dedication

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The oil and gas industry in the United States is highly dependent upon an intricate set of agreements that allow oil and gas to be gathered from privately owned land. Historically, the dedication language in oil and gas...more

McGuireWoods LLP

New Bankruptcy Ruling Could Impact Future Midstream Contracts

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On Oct. 28, 2020, the U.S. Bankruptcy Court for the Southern District of Texas delivered a key ruling affecting: (1) purchase and sale agreements for produced gas and severed minerals; and (2) agreements with “exclusive...more

Troutman Pepper Locke

FERC Finds Abrogation of Gas TSAs Would Not Be in the Public Interest Ahead of Possible Bankruptcy Proceeding

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On October 28, 2020, FERC declined to abrogate or modify firm natural gas transportation service agreements (“Gulfport TSAs”) between Gulfport Energy Corporation (“Gulfport”) and Rockies Express Pipeline LLC (“Rockies...more

Jackson Walker

“Parties’ Words Matter” – New Houston Bankruptcy Court Decision in Chesapeake-ETC Dispute Provides Alternative Paths for...

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Over the past five years, bankruptcy courts have analyzed whether oil and gas producers’ contracts with midstream oil, gas, and produced water companies may be rejected if they create covenants running with the land. Through...more

Opportune LLP

Key Themes Gleaned From Recent Oil & Gas Bankruptcy Exit Financings, Lender Requirements

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As upstream oil and gas companies emerge from Chapter 11 bankruptcies, they’ll need to be mindful of exit credit facility terms and requirements that may reflect a shift from their prior experience and will likely affect...more

Vinson & Elkins LLP

FERC Rules It Has Concurrent Jurisdiction Over The Rejection Of FERC-Regulated Midstream Gas Contracts

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On June 22, 2020, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued an order concluding that the Commission and the United States Bankruptcy Courts have concurrent jurisdiction to review and address the...more

Jones Day

Oil and Gas Industry Update - Sabine Oil Not the Last Word on Treatment of Gathering Agreements in Bankruptcy

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In a leading precedent handed down in 2018—Sabine Oil & Gas Corp. v. Nordheim Eagle Ford Gathering, LLC (In re Sabine Oil & Gas Corp.), 734 Fed. Appx. 64 (2d Cir. May 25, 2018)—the U.S. Court of Appeals for the Second Circuit...more

Jones Day

The Year in Bankruptcy: 2019

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Except for disastrous fires that sparked the largest bankruptcy filing of the year, liabilities arising from the opioid crisis, the fallout from price-fixing, and corporate restructuring shenanigans, economic, market, and...more

Skadden, Arps, Slate, Meagher & Flom LLP

A Look at 2019 Court Decisions That May Shape Restructuring Issues in the Year Ahead

A series of decisions over the past year — on issues such as make-whole premiums, intercreditor agreements, backstops for rights offerings and nonconsensual third-party releases — will likely have a significant impact in 2020...more

McGuireWoods LLP

Texas Bankruptcy Ruling Reinforces Dedication Clauses in Gas-Gathering Agreements

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A Texas bankruptcy court recently ruled that dedication clauses in gas-gathering agreements run with the land and cannot be rejected by a debtor. That decision, In re Alta Mesa Resources, Inc., affirms an industrywide...more

King & Spalding

Bankruptcy Court Rules that Dedications Within Gathering Agreements "Run with the Land”

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On December 20, 2019, the Bankruptcy Court for the Southern District of Texas in Alta Mesa Holdings, LP v. Kingfisher Midstream, LLC (In re Alta Mesa Resources, Inc.) held that dedications in gathering agreements create...more

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