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
On June 8, 2021, the Bureau of Ocean Energy Management issued a Request for Interest (RFI) to assess interest in possible commercial wind energy leasing in the Gulf of Mexico OCS. BOEM will consider the information received in response to the RFI to determine whether to schedule a competitive lease sale or issue a noncompetitive lease for any portion of the area descried in the RFI. The area covered by the RFI comprises the entire Central Planning Area and Western Planning Area of the Gulf of Mexico, excluding portions of those areas located in water depths greater than 1,300 meters.
Continue Reading BOEM Assessing Interest in Wind Energy Leasing in the Gulf of Mexico
Updated from May 18, 2021 post.
On May 17, 2021, the United States Supreme Court issued a decision in the climate change litigation affecting the fossil fuel industry. In a 7-1 decision (Justice Alito recused), the Court held that an appellate court must consider all grounds for removal when an appeal is taken pursuant to 28 U.S.C. § 1447(d), a provision that specifically authorizes interlocutory appeal of an order remanding a case removed pursuant to the federal officer removal statute.
Continue Reading United States Supreme Court Issues First Decision in Climate Litigation
In recent years, there has been an increase in litigation relating to the unleased owner reporting requirements contained in La. R.S. 30:103.1 and the penalty imposed in La. R.S. 30:103.2. There are few cases interpreting these statutes. However, the existing authority recognizes that even if an operator fails to comply with such reporting requirements, an unleased owner must provide sufficient notice under La. R.S. 30:103.1 and 103.2 before the statutory penalty may be imposed. The recent non-final interlocutory ruling in Limekiln Development, Inc. v. XTO Energy, Inc.,[1] provides yet another data point in an otherwise barren area of Louisiana law about the notices required under this statutory scheme in order to properly place operators on notice and to potentially impose the penalty of La. R.S. 30:103.2.
Continue Reading United States Western District of Louisiana Issues Opinion on Notice Required Under La. R.S. 30:103.1 and 103.2 to State a Plausible Claim for Relief
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
On April 19, the United States Government Accountability Office (“GAO”) released a report (the “Report”) in response to a request from the House of Representatives Committee on Natural Resources regarding the oversight and decommissioning of pipelines in federal waters, which are mainly located within the Gulf of Mexico. The Report concluded that the Bureau of Safety and Environmental Enforcement (“BSEE”) lacks a robust oversight process (1) for ensuring the integrity of active offshore oil and gas pipelines and (2) to address the environmental risks posed by decommissioning and abandoning pipelines on the seafloor. The GAO recommended that BSEE take actions to further develop, finalize, and implement updated pipeline regulations to address limitations in its ability to (1) ensure active pipeline integrity and (2) address safety and environmental risks associated with pipeline decommissioning and abandonment.
Continue Reading Federal Agency Recommends Updated Regulations for Pipeline Monitoring, Decommissioning, and Abandonment
The Texas Supreme Court recently released its anticipated opinion in Eagle Oil & Gas Co. v. TRO-X, L.P., 18-0983, 2021 WL 1045723, at *1 (Tex. Mar. 19, 2021) (“Eagle II”). The Eagle II case is the second case that arose between TRO-X, L.P. (“TRO-X”) and Eagle Oil & Gas Co. (“Eagle”) regarding their agreement to jointly acquire and sell oil and gas leases. In the first, Eagle Oil & Gas Co. v. TRO-X, L.P., 416 S.W.3d 137, 149 (Tex. App.—Eastland 2013, pet. denied) (“Eagle I”), TRO-X alleged that Eagle deprived TRO-X of its right to acquire certain mineral interests upon the sale of several leases in violation of their agreement. TRO-X lost that suit on appeal when the court of appeals found that TRO-X held equitable title to those interests and thus was not deprived of them. In Eagle II, TRO-X alleged that Eagle failed to pay TRO-X its share of income generated from production on the equitable interests. In response, Eagle asserted several affirmative defenses—res judicata (claim preclusion), the statute of limitations, and waiver—in a motion for summary judgment. The trial court granted the motion, the court of appeals reversed, and the Supreme Court affirmed the court of appeals, finding that Eagle did not conclusively establish any of its affirmative defenses.
Continue Reading Texas Supreme Court Update: TRO-X Lives to Fight Another Day in Contractual Dispute over Share of Income on Production from Equitable Interests
During his first hours in the Oval Office, President Biden issued Executive Order 13990, entitled “Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis.” Section 6 of the Order revoked TransCanada Keystone Pipeline, L.P.’s March 2019 permit to construct and operate cross-border pipeline facilities at the U.S.-Canada border in Montana.
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. Randle, affirming in part and reversing in part the lower court’s ruling. No. 19-0459, 2021 WL 936175 (Tex. Mar. 12, 2021). The Court (1) affirmed that the lower court
The Texas Supreme Court recently issued its anticipated decision in BlueStone Natural Resources II, LLC v. Randle, affirming in part and reversing in part the lower court’s ruling. No. 19-0459, 2021 WL 936175 (Tex. Mar. 12, 2021). The Court (1) affirmed that the lower court correctly concluded the oil and gas lease at issue explicitly resolved conflicting royalty provisions in favor of a gross-proceeds calculation; and (2) affirmed the lower court’s interpretation regarding application of the lease’s free-use clause, but remanded the case to recalculate the amount awarded to the royalty owners.
Continue Reading Texas Supreme Court Update: The Court Decides Issue of First Impression Related to the Scope of an Oil and Gas Lease’s Free-Use Clause and Further Interprets Conflicting Royalty Clause Provisions