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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. 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.
Investing in oil and gas royalties involves purchasing the rights to receive a portion of the revenue generated from the production and sale of oil and gas from a particular property or lease. Passive Income : Oil and gas royalties can provide investors with a source of passive income.
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 Resources , 939 S.W.2d
The Associated Press reported today that a federal jury found Kerr McGee liable for additional royalties on crude oil produced from federal properties and sold through Texon. Kerr McGee had denied the allegations and claimed that no additional royalties were owed. Kerr McGee has indicated that intends to appeal the verdict.
by Elisabeth Lorio Baer Interior Secretary Ken Salazar informed Congress on September 17, 2009 that he would kill a controversial program, currently in effect, that allows energy companies to pay the government royalties for drilling on public lands in actual oil and gas in lieu of cash. For the full story, see [link]
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.
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.
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.
Ross alleged that Shell failed to pay royalties in accordance with the lease agreement and that it fraudulently deprived him of royalties by making payments “based on an arbitrary amount even below the internal transfer price.” Shell, however, did not calculate royalty payments based on the price it received for the gas.
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. 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.
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.
the Third Circuit addressed the question of whether or not a mineral lessee must pay its lessor full lease-basis royalties for production undertaken during the effective period of a conditional allowable but prior to the effective date of a unit order. [1] Anglo-Dutch Energy, L.L.C. , Anglo-Dutch Energy, L.L.C. , Anglo-Dutch Energy, L.L.C. ,
10] Gloria’s Ranch amended its petition to include a claim for failure to pay royalties on production in Section 15 (from the unit well drilled by Chesapeake). 11] The trial court also found that defendants failed to pay royalties in Section 15 and awarded Gloria’s Ranch the royalties owed plus punitive damages. [12]
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. To receive information from Liskow & Lewis, your information will be kept in a secured contact database.
By Jonathan Hunter: In a highly anticipated decision, the Tenth Circuit held this week that the district court had subject matter jurisdiction over a qui tam action filed by an MMS auditor concerning royalty payments on crude oil produced from offshore federal leases. The court also ruled that “Mr. A link to the decision is attached.
The Louisiana Mineral and Energy Board is currently reviewing an incentive proposal that would offer a “royalty relief incentive” on new drilling leases along the Louisiana coast. Specifically, the proposal would offer royalties for a period of three years for wells drilled to a depth of fifteen thousand feet along the coastal zone.
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.,
February 24, 2025 Edition At Valor, our goal is to keep you informed of the latest news and updates from the oil and gas industry. Stay tuned for weekly updates to keep you well-informed. We are committed to sharing the insights and knowledge that our team gathers to help you stay ahead in this dynamic sector. The EIA forecasts U.S.
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. To receive information from Liskow & Lewis, your information will be kept in a secured contact database.
Earlier information about this case can be found here. *In To receive information from Liskow & Lewis, your information will be kept in a secured contact database. Although not yet final, this reversal is long-awaited victory for unit operators in Louisiana. Johnson Ruling Reversing Prior PPC Ruling.
However, the tax will only affect companies currently using a loophole to avoid paying royalties on the energy supplies they drill. Those already paying royalties would get a tax credit. For more information, go to [link] oil and gas supplies.
To receive information from Liskow & Lewis, your information will be kept in a secured contact database. The order creating the unit will also name a unit operator and allocate unit costs in the same proportion that unit production is allocated. Communications include firm news, insights, and events.
By using this blog site you understand and acknowledge that there is no attorney client relationship formed between you and Liskow & Lewis and/or the individual Liskow & Lewis lawyers posting to this site by virtue of your using this site.
In the past, the State hired outside counsel to pursue claims for allegedly underpaid royalties and severance taxes and paid those outside lawyers on a contingency basis. For more information on the proposed legislation, see www.nola.com/business/t-p/index.ssf/base/money-2 Ieyoub, 96-1110 (La. 9/9/97), 700 So.
Disclaimer The above general discussion is provided for background information only. This information is not intended to be individual advice. For more information, please visit www.irs.gov. Crude Oil Investing: A Guide for Accredited Investors Investing in Oil and Gas Royalties Explained What are Tangible Drilling Costs?
for a one-fourth (1/4) mineral royalty and as much as ten thousand ($10,000) dollars per acre bonus royalty.” To receive information from Liskow & Lewis, your information will be kept in a secured contact database. Communications include firm news, insights, and events.
UNOCAL also reserved a 3% overriding royalty. To receive information from Liskow & Lewis, your information will be kept in a secured contact database. UNOCAL assigned operating rights in the leases to ATP, who later assigned 20% of those rights to Sojitz. Next, Sojitz pointed to the district court’s factual findings (e.g.,
1] In the case, a landowner sued its mineral lessees for: (1) failure to provide a recordable act evidencing the expiration of a mineral lease under Mineral Code articles 206-209 and (2) failure to pay royalties under Mineral Code articles 137-140. [2] in unpaid royalties and an additional double damages penalty of $484,058.52
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.
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. For more information, contact Jeff Lieberman ( jdlieberman@liskow.com ).
On appeal, the Amarillo Court of Appeals agreed with Red Deer, finding that BP could not invoke the lease’s shut-in royalty clause because production from the last well was so slow that production in paying quantities had ceased, and thus the lease terminated, prior to BP shutting the wells in and offering to pay shut-in royalties.
Consulting and professional services are crucial for making informed decisions and optimizing drilling operations. This category includes lease acquisition fees, rentals, and royalty payments to property owners and mineral rights holders. Disclaimer The above general discussion is provided for background information only.
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. To receive information from Liskow & Lewis, your information will be kept in a secured contact database.
At issue in Southwest Royalties, Inc. Liskow & Lewis attorneys Butch Marseglia and Jillian Marullo submitted an amicus brief in Southwest Royalties on behalf of EOG Resources, Inc.
Tauren Exploration, Inc. , A detailed summary of that decision is available here. On August 7, in a 3-2 decision, a panel of five Second Circuit judges denied the defendants’ application for rehearing.
Jinapor highlighted the mining lease for lithium exploitation, emphasizing its global standard with provisions for value addition, increased royalties, and local participation. He cautioned against making sweeping statements about land sales without verifying information from the Lands Commission. Source: Myjoyonline.com
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.
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