TC Energy Corporation stated that it filed a notice of intent with the U.S. Department of State that it will make a claim against the U.S. under the North American Free Trade Agreement (NAFTA). The claim will be based on President Biden’s January 2021 revocation of TC Energy’s Keystone XL Pipeline permit.
Continue Reading TC Energy’s $15B Claim Against U.S. for Biden’s Revocation of Keystone XL Pipeline Permit
Devon Energy Production Company, L.P. v. Sheppard is a royalty dispute between several lessees, Devon Energy Production Co., L.P., et. al., and several lessors, Michael A. Sheppard, et. al., concerning a novel royalty term that may have a huge impact on the way oil and gas royalties are paid in the future. See 13-19-00036-CV, 2020 WL 6164467, at *12 (Tex. App.—Corpus Christi Oct. 22, 2020, pet. filed). The novel term, referred to as an “add-back” or “add-to-proceeds” provision, requires any deductions to the sale of production to be added back to the proceeds in order to determine the appropriate royalty base. The lessors argue that under this term, the deductions in the lessees’ sales contracts attributable to the buyers’ post-transfer costs must be added to the gross proceeds in order to establish a royalty base above the gross proceeds. The lessees disagree, countering that the clear intent of the provision is merely to prohibit the deduction of their own post-production costs, not the post-transfer costs of the buyers. The lessors won in the trial court; the court of appeals affirmed. Now the case is before the Texas Supreme Court, with a recently submitted amicus brief containing the argument that could turn the tides back in the lessees’ favor.
Continue Reading New Developments in Shocking Case Before the Texas Supreme Court Regarding Construction of Novel Oil & Gas Royalty Term
On June 30, 2021, the Louisiana Supreme Court issued an opinion redefining the nature of available damages and the “actual, statutorily permitted role of the jury in Act 312 remediation lawsuits.” The “LL&E II” decision finds that Act 312 charges the court, not the jury, to determine the funding needed to remediate property to government standards. If (and only if) an express contractual provision requires greater remediation than government standards, a jury may consider and award such “excess remediation” damages. State of Louisiana v. Louisiana Land and Exploration Co., 2020-00685 (La. 6/30/2021); — So. 3d — (“LL&E II”).[1]
Continue Reading Overturning 8 Years of “Palpable Error,” The Louisiana Supreme Court Limits Damages Available to Landowners in Oilfield Legacy Litigation
Perhaps the most important right granted in a solar development agreement is the right of the solar developer to use the surface of the property to evaluate, construct, and operate the solar farm. But how can the solar developer ensure that its right to use the surface of the property is not encumbered by or inferior to the rights of others? Or, more specifically, how can the solar developer ensure that a mineral estate owner will not be able to locate a well in the middle of its solar farm? This issue is at the forefront of the minds of the renewables industry and was the subject of a recent Texas Court of Appeals decision. As renewable energy projects continue to multiply, clashes between solar developers and mineral interest owners will increase as well.
Continue Reading Solar Leasing in Louisiana: The Accommodation Doctrine
In Lexington Land Development, L.L.C. v. Chevron Pipelines Company, et al., 2020-0622 (La. App. 1 Cir. 5/25/21), 2021 WL 2102932, —So. 3d—, the Louisiana First Circuit recently reaffirmed well-settled principles regarding prescription and the subsequent purchaser doctrine in Louisiana legacy cases.
Continue Reading Louisiana First Circuit Reaffirms Prescription and Subsequent Purchaser Principles
On June 9, 2021, Texas Governor Greg Abbott signed House Bill 1284 (“HB 1284”), which was introduced along with its Senate companion, SB 450, during the state’s 87th legislative session. HB 1284 grants the Texas Railroad Commission (“RRC”), the governmental agency that regulates the state’s oil and gas industry, sole jurisdiction over Class VI Injection Wells and carbon capture, use, and sequestration (“CCUS”) activities in Texas.
Continue Reading New Legislation Signals Strong Support for CCUS in Texas
In a nod to LGBTQ+ Pride Month and the one-year anniversary of the Supreme Court’s landmark decision in Bostock v. Clayton County, the U.S. Equal Employment Opportunity Commission (EEOC) has released new resources “to educate employees, applicants and employers about the rights of all employees, including lesbian, gay, bisexual and transgender workers, to be free from sexual orientation and gender identity discrimination in employment.” The materials – none of which state new policy but instead rely on previously adopted positions – “are part of EEOC’s effort to ensure that the public can find accessible, plain language materials in a convenient location on EEOC’s website.”
Continue Reading EEOC Unveils New Online Resources in Observance of LGBTQ+ Pride Month
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. Biden, Jr., Case No. 2:21-cv-00778-TAD-KK, 2021 WL 2154963 (W.D. La. June 15, 2021).
Continue Reading Federal Judge Grants Preliminary Injunction Halting the Biden Administration’s “Pause” on New Oil and Gas Lease Sales
Continue Reading What Does Washington’s Pro-Union Push Mean for You?
Bringing to mind the infamous Hatfield-McCoy family feud, Concho Resources, Inc. v. Ellison is a classic boundary dispute between a leasehold owner and neighboring lessees with allegations of fraud and more than $1 million at stake. See 2021 WL 1432222 (Tex. Apr. 16, 2021). The plaintiff, Martha Ellison d/b/a Ellison Lease Operating, alleged that the defendant lessees, Samson Resources Company (“Samson”), COG Operating LLC (“Concho”), drilled and operated a well on her leasehold. The defendants—relying on a boundary stipulation and a written acceptance of such stipulation signed by Jamie Ellison, Mrs. Ellison’s deceased husband—claimed that Mr. Ellison ratified the agreed boundary line before his passing, foreclosing any claims of trespass. What ensued was a long legal battle with an ironic outcome. The defendants won in the trial court; the court of appeals reversed. The tables turned again at the Texas Supreme Court, which ultimately held that the boundary stipulation was valid and that the defendants conclusively established their ratification defense, but the case is still ongoing.
Continue Reading Texas Supreme Court Update: Boundary Dispute Between Leasehold Owner and Lessees of Adjacent Tract