On June 25 the 13th Court of Appeals in Corpus Christi issued is opinion in Devon Energy Production Co. v. Michael A. Sheppard, et al., No. 13-19-00036-CV making a deep dive into when post-production costs can be deducted from the plaintiffs’ royalty. Plaintiffs’ leases provided for royalties on oil and…
I was interviewed this week by Tiffany Dowell Lashmet, J.D., Agricultural Law Specialist with the Department of Agricultural Economics at Texas A&M University. Tiffany does lots of education programs for landowners at the Texas A&M AgriLife Research and Extension Center. She has a great blog for anyone involved in agriculture.…
Last April the Fort Worth Court of Appeals issued its opinion in Bluestone Natural Resources II, LLC v. Randle, No. 02-18-00271-CV, 2019 WL 1716415. The Court decided that, under Randle’s lease, Bluestone could not deduct post-production costs and owed royalty on plant fuel and compressor fuel. Bluestone has petitioned the…
A U.S. District Court in Arkansas decided a case in 2016 that a client sent me, Whisenhunt Investments, LLC v. Exxon Mobil Corp., 2016 WL 7494266, No. 4:13cv00656 JM, Eastern District of Arkansas, Western Division, raising an interesting issue on post-production costs. Arkansas has forced pooling. The forced pooling statute…
In a short opinion, the Supreme Court of North Dakota decided a case brought by Newfield Exploration against the North Dakota Board of University and School Lands to determine how royalties on gas should be calculated under the State’s leases to Newfield. The case illustrates how post-production costs can sometimes…
The Texas Supreme Court has denied motion for rehearing of its opinion in Burlington Resources Oil & Gas Company v. Texas Crude Energy, No. 17-0266. The case addresses deductibility of post-production costs in the context of an overriding royalty. The case may, however, have implications for post-production-cost deductions in oil…
Our firm hosted its 4th land and mineral owner seminar last Friday, and I spoke on deductability of post-production costs from lease royalties in light of the Texas Supreme Court’s decision last year in Chesapeake v. Hyder. My paper on post-production costs may be viewed here: Post-Production Costs after Hyder
The Court of Appeals in Corpus Christi issued its opinion today in Burlington Resources Oil & Gas Company LP v. Texas Crude Energy, LLC, et al. Link to the opinion is here: burlington v texas crude This is the first case to follow Chesapeake v. Hyder, the Texas Supreme Court’s…
Royalty owner opposition to Chesapeake is heating up in Pennsylvania. Chesapeake has sent royalty owners letters saying it has overpaid them by failing to deduct post-production costs and demanding reimbursement. Post-production cost deductions are exceeding revenues on Chesapeake’s royalty checks, resulting in a “negative royalty.” The Commissioners of Bradford County,…
Chesapeake Energy announced last week that it is selling (giving away?) all of its interest in the Barnett Shale to Saddle Barnett Resources, LLC, a company backed by First Reserve. First Reserve is a global private equity investment firm. The Barnett Shale is the birthplace of the shale revolution in…