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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
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.
million judgment for reimbursement of mineral royalties. million in mineral royalties attributable to ownership of these banks. As there are no such provisions governing the Crooks plaintiffs’ mineral royalties claims, the legislature has retained its discretion to appropriate funds for those claims. 1/1/23), So.
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.
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 Res., NationsBank , 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.” The Texas Supreme Court recently released its opinion in Van Dyke v. Dils Co. ,
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.
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.
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. in unpaid royalties, plus an additional double damages penalty of $484,058.52. in unpaid royalties, plus an additional double damages penalty of $484,058.52.
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.
When the dispute involves the nonpayment of royalties, the renewable energy lessee would be afforded 30 days to pay the royalties or respond in writing stating a reasonable cause for nonpayment (compare to La. Communications include firm news, insights, and events. compare to La.
12/19/07), the court addressed the payment of royalties and penalties under Mineral Code article 212.23(c) In exchange, the defendant agreed to transfer an overriding royalty interest in the subject prospect to the plaintiff in the event defendant acquired an interest in the prospect. In CLK Company, L.L.C. CXY Energy, Inc. ,
Of particular note is Arkansas’s unique payment structure for bromine production; rather than paying a royalty based on a percentage value for the brine or bromine, producers essentially pay a flat rental per acre to the landowners. Communications include firm news, insights, and events.
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. Communications include firm news, insights, and events.
Communications include firm news, insights, and events. The order creating the unit will also name a unit operator and allocate unit costs in the same proportion that unit production is allocated. In addition to the unit order, the operator must receive approval for its injection wells. 30:1101-1111).
UNOCAL also reserved a 3% overriding royalty. UNOCAL retained rights as to certain depths, but never conducted any lease operations whatsoever at any depth. After receiving an order from BSEE, Sojitz decommissioned the leases at its expense and filed suit against UNOCAL to recover the costs. 611 (Bankr.
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. TRO-X, L.P. ,
Communications include firm news, insights, and events. For nearly three years, unit operators in Louisiana have waited to see whether the Western District of Louisiana would change course or double down on its March 2019 decision in Johnson v. Chesapeake. Neither contained any provision for attorney’s fees.
for a one-fourth (1/4) mineral royalty and as much as ten thousand ($10,000) dollars per acre bonus royalty.” Communications include firm news, insights, and events. However, if the current trend continues, the Haynesville could approach its prior peak production average in early 2019.
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. TRO-X, L.P. ,
Louisiana Revised Statute 31:210 addresses rental and royalty payments that are owed to parties holding an interest in the leased property when an issue arises as to title. Communications include firm news, insights, and events. The district court, applying La Civ. 521-524’s good faith purchaser defense, rather than La.
Therefore, under Texas law, working interest owners such as producers and royalty owners automatically possess a security interest in the oil and gas extracted from their properties against said first purchaser, thereby providing protection, clarity, and efficiency in the legal framework governing these transactions.
Louisiana Revised Statute 31:210 addresses rental and royalty payments that are owed to parties holding an interest in the leased property when an issue arises as to title. Communications include firm news, insights, and events. The district court, applying La Civ. 521-524’s good faith purchaser defense, rather than La.
30:10] simply means that, for all of this, he is given the equivalent of a “no cost” royalty clause on production proceeds. 9] The Court described the question before it as an issue of first impression and focused on the language of La. 10] In its analysis, the Court first looked to the statutory language of La. 30:10) throughout La.
This category includes lease acquisition fees, rentals, and royalty payments to property owners and mineral rights holders. Lease Costs and Mineral Rights: These costs encompass expenses related to securing the rights to explore, develop, and produce oil and gas on specific properties or land.
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. In the meantime, more questions than answers remain regarding the regulatory framework for offshore CCS.
Communications include firm news, insights, and events. 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. 1] 26 U.S.C. § 45X(b)(1)(M). [2] 2] 26 U.S.C. § 45X(c)(6)(P). [3] 3] 26 U.S.C. § 30D(e)(1). [4]
and Veren’s website at www.vrn.com by selecting “Investors” , then “Presentations & Events”. Leading Low Decline Light Oil Position in Saskatchewan : The combined company becomes the second largest producer in Saskatchewan with consolidated assets in west and southeast Saskatchewan.
Investors are attracted to preferred equity because, in the event the SMB fails and is liquidated, those investors by agreement are repaid after payment of all secured and unsecured creditors and administrative expenses, but before any payments to holders of the common equity of the company.
In short, the Plaintiff States would suffer increased energy costs, additional regulatory burdens, violation of their procedural rights, and reduced revenue from taxes and royalties as energy production and exploration slowed. Communications include firm news, insights, and events. Background.
The Court found that the Plaintiff States demonstrated a substantial threat of irreparable harm due to “reduced funding for bonuses, ground rent, royalties, and rentals,” and “damage for reduced funding” for various state programs. Communications include firm news, insights, and events. at 38-40. (2)
The Court found that the Plaintiff States demonstrated a substantial threat of irreparable harm due to “reduced funding for bonuses, ground rent, royalties, and rentals,” and “damage for reduced funding” for various state programs. Communications include firm news, insights, and events. at 38-40. (2)
The Court found that the Plaintiff States demonstrated a substantial threat of irreparable harm due to “reduced funding for bonuses, ground rent, royalties, and rentals,” and “damage for reduced funding” for various state programs. Communications include firm news, insights, and events. at 38-40. (2)
Communications include firm news, insights, and events. But the oil and gas industry stands to be impacted regardless of the election outcome in November, and those impacts will have wide-reaching effects on the U.S. economy, its energy independence, and its diplomatic relations. away from its reliance on fossil fuels.
Communications include firm news, insights, and events. But the oil and gas industry stands to be impacted regardless of the election outcome in November, and those impacts will have wide-reaching effects on the U.S. economy, its energy independence, and its diplomatic relations. away from its reliance on fossil fuels.
Communications include firm news, insights, and events. But the oil and gas industry stands to be impacted regardless of the election outcome in November, and those impacts will have wide-reaching effects on the U.S. economy, its energy independence, and its diplomatic relations. away from its reliance on fossil fuels.
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