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Accordingly, auditing of royalty payments was left to the Mineral Board’s internal accountants, and when an issue arose as to whether royalty payments were made correctly, the Mineral Board’s land personnel and internal counsel would oversee sending demands and pursuing litigation against the State’s mineral lessees and well operators.
2023), in which it held that lessees owed royalties in excess of their gross proceeds, specifically “adding back” costs incurred by third-party buyers that were enumerated in the sales contract and subtracted from the sales price. The leases contained the following royalty provisions: 3. Sheppard , — S.W.3d NationsBank”, 939 S.W.2d
million judgment for reimbursement of mineral royalties. million in mineral royalties attributable to ownership of these banks. The Court then pointed to Louisiana Constitution article XII §10(C) and La. State of Louisiana through the Department of Natural Resources , 22-0625 (La. 1/1/23), So. 13:5109(B)(2).
While 30:10 was amended during the 2022 legislative session, the amendment preserved the limited obligation of remitting the royalty and overriding royalty burdens to the nonparticipating owner for the benefit of the royalty and overriding royalty owners.
Sheppard is a royalty dispute between several lessees, Devon Energy Production Co., concerning a novel royalty term that may have a huge impact on the way oil and gas royalties are paid in the future. The royalty clause at issue required the lessees to pay to the lessors 1/5th of the “gross proceeds” as a royalty.
On June 2, 2017 the Louisiana Second Circuit Court of Appeal affirmed a trial court’s judgment cancelling a mineral lease under Mineral Code article 140 and provided further clarity on a production in paying quantities analysis under Louisiana Mineral Code article 124. [1] 1] The dispute in Gloria’s Ranch, L.L.C.
With the prevalence of cases involving royalty disputes in Texas, the state’s Supreme Court has never hesitated to address these issues. But the Court’s sporadic holdings regarding royalty clauses, each so specific to the particular language of the lease, have left lessees on unsteady footing. Heritage Resources , 939 S.W.2d
In the 1920s—the time the deed at issue was executed—lessors commonly reserved a one-eighth royalty interest when they executed oil and gas leases. In addition to the estate misconception theory, the Court analyzed the “legacy of the one-eighth royalty.” Dils Co. , 2d 904 (Tex.
Jan 12, 2024) concerns how three related provisions in an oil and gas lease interact: (1) a royalty clause; (2) a free-use clause; and (3) an off-lease clause. When parties to an oil and gas lease reserve royalties, they stipulate where those royalties are to be valued—sometimes referred to as the “valuation point”—in the royalty clause.
While the Court is no stranger to interpreting (and often muddling) the familiar royalty clause interpretation questions surrounding the first issue, in a case of first impression, the Court also analyzed the breadth of a lease’s free-use clause. after deductions), resulting in lower royalty payments for the royalty owners.
In a straightforward application of Louisiana’s prescriptive principles, the Louisiana Court of Appeal for the Third Circuit affirmed the trial court’s grant of exceptions of prescription, finding plaintiff’s claims for fraud, under the Louisiana Unfair Trade Practices Act (LUTPA), and for unpaid royalties all prescribed in Karen May v.
hands a victory to financiers of oil and gas operations and settles a long-running controversy over the amount of damages available for failure to pay mineral royalties. Those articles set forth the obligations of the “former owner” or “former lessee” to provide written evidence that mineral rights have been extinguished.
Although the bill expressly provides that “[a] renewable energy lease is not a mineral lease,” the proposed legislation contains a number of provisions that are either identical or substantially similar to the Louisiana Mineral Code articles governing mineral leases. 122); The lessee of a renewable energy lease would be “bound to.
While the Court is no stranger to interpreting (and often muddling) the familiar royalty clause interpretation questions surrounding the first issue, in a case of first impression, the Court also analyzed the breadth of a lease’s free-use clause. after deductions), resulting in lower royalty payments for the royalty owners.
In a straightforward application of Louisiana’s prescriptive principles, the Louisiana Court of Appeal for the Third Circuit affirmed the trial court’s grant of exceptions of prescription, finding plaintiff’s claims for fraud, under the Louisiana Unfair Trade Practices Act (LUTPA), and for unpaid royalties all prescribed in Karen May v.
Free-Use Clause and Further Interprets Conflicting Royalty Clause Provisions The Texas Supreme Court recently issued its anticipated decision in BlueStone Natural Resources II, LLC v. For almost a decade, the original lessee to the agreements never subtracted post-production costs from the royalty owners’ royalty payments.
This article summarizes the arguments made by the parties, and the Justices' questions and observations at the oral argument. This case presents two critical questions: Who owns subsurface caverns created by salt mining operations, and How should in-kind royalties be calculated for salt production? The case was Myers-Woodward v.
This article focuses on the latter. Like traditional exploration and development, CCUS projects require the operator to secure both the necessary private property rights from landowners as well as regulatory approval from the appropriate administrative agency in order to proceed. Regulatory approval for CCUS falls under two broad categories.
1, 2024), the Fifth Circuit held that an oil-and-gas royalties class action belongs in federal court based on its interpretation that the “principal injuries” prong of the CAFA local controversy exception requires all plaintiffs sustain their principal injuries in the forum state. As a matter of first impression, in Cheapside Mins.,
The pursuit of alternative energy sources has become increasingly important in our quest for a sustainable future. Lithium, a key component in rechargeable batteries, has emerged as a vital element for powering electric vehicles and storing renewable energy. A brine extraction prospect would be very similar to an oil and gas prospect.
In the interest of full disclosure, the authors of this article served as counsel of record on behalf of an amici group in Johnson, as counsel of record on behalf of the defendants in Self, and as counsel of record on behalf of various Louisiana operators in other lawsuits implicated by Johnson and Self. BPX Operating Co.,
El Paso E & P Co. , El Paso E & P Co. , for a one-fourth (1/4) mineral royalty and as much as ten thousand ($10,000) dollars per acre bonus royalty.” Instead, this year, the Haynesville has seen steady increases in production since January when production averaged 5.293 billion cubic feet per day. 45,634 (La.
UNOCAL also reserved a 3% overriding royalty. 2003) (“the regulations govern the parties’ joint and several liabilities vis-à-vis the Government not amongst themselves”) and Total E&P USA, Inc. Sojitz Energy Venture, Inc. Union Oil Co. of California , 394 F. 3d 687 (S.D. Parker Drilling Co. , 3d 558, 563 (5th Cir.
Flat River Farms, L.L.C. , the Louisiana Second Circuit addressed issues affecting the creation and preservation of mineral servitudes and payment of court costs in a concursus action. [1] 1] In the case, an operator initiated a concursus action seeking to resolve ownership interest in minerals underlying property on which it was operating.
Several years later, Eagle purchased several leases and sold them to Chesapeake Exploration, LLC (“Chesapeake”), reserving an overriding royalty interest and a back-in working interest (the “Interests”). When the suit went to trial, the leases subject to the Chesapeake sale had not generated any royalty income. Analysis and Holding A.
A recent decision from the Louisiana First Circuit Court of Appeal may have lasting effects on good faith purchasers of oil. TMR Exploration, Inc , 2021 WL 267916, the First Circuit affirmed a district court ruling on summary judgment applying the good faith purchaser defense provision set forth in La.
Importantly, the first resolution emphasizes “that the Temporary Moratorium and Resumption Period enacted by this Resolution do not allow an operator or lessee to fail to pay royalties if they continue to obtain production during these times. The Board approved two proposed resolutions (1. Proposed Enforcement Moratorium Resolution 2.
District Court for the Western District of Louisiana held that a unit operator may not recover post-production costs from an unleased mineral owner’s share of production proceeds in Allen Johnson, et al. Chesapeake Louisiana, LP. [1] 2] The UMOs argued that La. Chesapeake Louisiana, LP. [1] 2] The UMOs argued that La. The UMOs argued that La.
Several years later, Eagle purchased several leases and sold them to Chesapeake Exploration, LLC (“Chesapeake”), reserving an overriding royalty interest and a back-in working interest (the “Interests”). When the suit went to trial, the leases subject to the Chesapeake sale had not generated any royalty income. Analysis and Holding.
A recent decision from the Louisiana First Circuit Court of Appeal may have lasting effects on good faith purchasers of oil. TMR Exploration, Inc , 2021 WL 267916, the First Circuit affirmed a district court ruling on summary judgment applying the good faith purchaser defense provision set forth in La.
As a key component of most batteries, lithium is ubiquitous in our daily lives. From the moment your alarm on your cell phone goes off in the morning, to using your battery-powered toothbrush, to reading this blog post on your laptop or tablet, lithium makes it all work.
The CEQ report noted that royalty rate reduction credits for carbon capture could potentially create financial incentives for investment and recognized the need to address long-term liability after a storage site has been closed.
This article briefly describes four structured capital raising techniques that may be available to meet those needs: (1) convertible debt instruments; (2) convertible or non-convertible preferred equity instruments; (3) preferred limited partnership interests; and (4) debt instruments issued with “equity kickers”.
On February 11, 2022, the Biden Administration’s climate change agenda sustained a major blow as Judge James D. Cain of the Western District of Louisiana enjoined a Biden administration executive order that charged federal agencies with considering the “social cost of carbon” in their decision making. Background. The Court Had Standing.
On Tuesday, U.S. District Judge Terry A. Doughty of the Western District of Louisiana granted Plaintiff States’ request for an injunction to block the Biden Administration’s pause on new federal oil and gas lease sales (“Lease Pause”). Louisiana v. 2:21-cv-00778-TAD-KK, 2021 WL 2154963 (W.D. June 15, 2021). at 26-27.
On Tuesday, U.S. District Judge Terry A. Doughty of the Western District of Louisiana granted Plaintiff States’ request for an injunction to block the Biden Administration’s pause on new federal oil and gas lease sales (“Lease Pause”). Louisiana v. 2:21-cv-00778-TAD-KK, 2021 WL 2154963 (W.D. June 15, 2021). at 26-27.
On Tuesday, U.S. District Judge Terry A. Doughty of the Western District of Louisiana granted Plaintiff States’ request for an injunction to block the Biden Administration’s pause on new federal oil and gas lease sales (“Lease Pause”). Louisiana v. 2:21-cv-00778-TAD-KK, 2021 WL 2154963 (W.D. June 15, 2021). at 26-27.
In the midst of a chaotic year and a tense campaign season, issues such as COVID-19, race relations, and healthcare seem to be at the forefront of Americans’ minds as they head to the polls on November 3. economy, its energy independence, and its diplomatic relations. Due to the sharp increase in oil and gas production, the U.S. s energy sector.
In the midst of a chaotic year and a tense campaign season, issues such as COVID-19, race relations, and healthcare seem to be at the forefront of Americans’ minds as they head to the polls on November 3. economy, its energy independence, and its diplomatic relations. Due to the sharp increase in oil and gas production, the U.S. s energy sector.
In the midst of a chaotic year and a tense campaign season, issues such as COVID-19, race relations, and healthcare seem to be at the forefront of Americans’ minds as they head to the polls on November 3. economy, its energy independence, and its diplomatic relations. Due to the sharp increase in oil and gas production, the U.S. s energy sector.
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