On February 27th of this year, the Texas Supreme Court heard oral argument in a suit filed by landowners (“Wheeler”) against Enbridge Pipelines (East Texas), L.P. (“Enbridge”). The basis of the suit was damage to land on a right of way. The fact that there was damage was not contested. What was contested was the […]
The Horizontal Severance Question
As many know, Pioneer Natural Resources USA, Inc., (“Pioneer”), recently requested that the Texas Railroad Commission amend the field rules for the Spraberry (Trend Area) Field in Districts 7C and 8 to allow for duplicate assignment of acreage when mineral rights were horizontally severed. Statewide Rule 40(d) prohibits the duplicate assignment of acreage. The Spraberry […]
Allocation Revisited
A few months ago I wrote on the Texas Railroad Commission’s issuance of permits for “Allocation Wells.” Specifically, I noted that EOG Resources, Inc., in 2012, applied for a permit to drill an Allocation Well that crossed leases in which it did not have the right to pool. The mineral owners protested the issuance of […]
When Production gets “Allocated”
The advent of the “Allocation Well” comes with a fresh legal challenge, where horizontal well royalties are concerned. A new Railroad Commission phenomena has developed recently, despite obvious rulings to the contrary. The name? Allocation Wells. Operators that are diving into horizontal drilling may already know all they need to know, but for the rest, […]
From the General Counsel: The Point of Valuation
In New Mexico, a challenge to a lower court’s decision has caused the state’s Supreme Court to take a longer look at what it means to pay a lessor an established portion of the “net proceeds” from the sale of gas. More than a few months ago I wrote about the Commissioner of Public Lands […]
From the General Counsel: “Just Compensation” Could be “For the Taking”
House Bill 1496, if passed, could bring a new twist to the old workings of eminent domain. Most operators have probably come across that one local municipality that is such a pain to deal with, due to regulations and restrictions imposed upon drilling activities, that the better option seems to be avoidance of such an […]
From the General Counsel
In New Mexico, the Court of Appeals rules on whether oil and gas producers can waive their obligation to pay interest on proceeds held up by delays in distribution. The New Mexico Court of Appeals was recently called upon to determine whether a contractual agreement to waive interest on proceeds owed to mineral owners was […]
From the General Counsel
New Mexico Beckons The possibility of changes to the “pit rule” could make the state more appealing to energy producers. Could relief be in sight for higher-priced oil and gas operations in New Mexico? May 14, 2012, saw the beginning of the public hearings in front of the New Mexico Oil Conservation Commission regarding proposed […]