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LPSC petitioned for review of FERC's rejection of LPSC's request to reform certain depreciation rates. The DC Circuit denied the petition for review and rejected LPSC's claim that FERC failed to confront its asserted evidence of undue discrimination where FERC fulfilled such obligations; FERC precedent did not require the use of FERC's own depreciation standards; and there has been no unlawful subdelegation because FERC has exercised, and intends to continue to exercise, its authority. View "Louisiana Public Service Commission v. FERC" on Justia Law

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In construing an unambiguous deed, the parties’ intent is paramount, and that intent is determined by conducting a careful and detailed examination of a deed in its entirety rather than applying some default rule that appears nowhere in the deed’s text. In this case, the Supreme Court construed a deed that conveyed a mineral estate and the surface above it. At issue was whether the language of the deed passed the entire burden of an outstanding non-participating royalty interest (NPRI) to the grantees or whether the NPRI proportionately burdened the grantor’s reserved interest. The trial court ruled that the deed burdened both parties with an outstanding NPRI and that the parties must share the burden of the NPRI in proportion to their respective fractional mineral interests. The court of appeals affirmed. The Supreme Court affirmed, holding that the only reasonable reading of the deed in this case resulted in the parties bearing the NPRI burden in shares proportionate to their fractional interests in the minerals. View "Wenske v. Ealy" on Justia Law

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In this dispute involving mineral interests pooled for natural gas production, lessors and other stakeholders alleged that the lessee underpaid royalties owed to them under their mineral leases and pooling agreements. The issues presented in this appeal centered on the lessee’s efforts to avoid a contractual obligation to pay royalties to the overlapping unit stakeholders for production from a zone shared by the two pooled units. The lower courts held that the agreement to pay royalties was enforceable. The Supreme Court affirmed, holding (1) ineffective conveyance of title does not preclude the lessee’s liability under a contract theory; (2) the lessee’s quasi-estoppel and scrivener’s error defenses to contract enforcement failed as a matter of law; and (3) the lessee was not entitled to recoup royalty payments from stakeholders in another pooled unit; (4) this court’s decision in Hooks v. Samson Lone Star, Ltd. Partnership, 457 S.W. 3d 52 (Tex. 2015) precluded the unpooling stakeholders’ claims; and (5) the court of appeals properly construed a proportionate-reduction clause to award royalties owed to the overlapping unit stakeholders in accordance with their fifty percent mineral-interest ownership. View "Samson Exploration, LLC v. T.S. Reed Properties, Inc." on Justia Law

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ConocoPhillips Co. and Alma Energy Corp. exchanged oil and gas interests under an exchange agreement in which each indemnified the other for any environmental claims related to the properties received. Alma later filed for protection under Chapter 11 of the Bankruptcy Code. Thereafter, Noble Energy Inc. agreed to by the properties Alma had received from Conoco under the exchange agreement. After the bankruptcy proceeding concluded, an environmental contamination suit was filed against Conoco, and Noble refused to indemnify Conoco under the exchange agreement. Conoco filed suit against Noble alleging breach of the exchange agreement and seeking to recover the $63 million it paid to settle the suit. The trial court granted summary judgment for Noble. The court of appeals reversed and entered summary judgment for Conoco, concluding that the exchange agreement was an executory contract that was assumed by Alma and assigned to Noble in the bankruptcy proceeding. The Supreme Court affirmed, holding that under the terms of the bankruptcy court order confirming the plan of reorganization and the agreement for sale of Alma’s assets, Noble was assigned an undisclosed contractual indemnity obligation of Alma. View "Noble Energy, Inc. v. Conocophillips Co." on Justia Law

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MISO, a nonprofit association of utilities, manages electrical transmission facilities for its members. Beginning in 2006, the Federal Energy Regulatory Commission (FERC) approved changes to MISO’s Tariff that enabled it to authorize network expansion projects and divide the costs among the member utilities. Duke and American own Ohio and Kentucky utilities. In July 2009, American gave notice that it planned to withdraw from MISO. Duke followed suit in May 2010. Under the Tariff, a utility cannot withdraw from MISO any earlier than the last day of the year following the year it gives notice. Two months after Duke announced its intention to withdraw, MISO proposed a new category of more expensive expansion projects. FERC approved this revision to the Tariff. In August 2010, MISO authorized the first Multi-Value Project. In December 2011, weeks before Duke’s scheduled departure, MISO approved 16 projects, to cost billions of dollars. MISO proposed amending the Tariff, so that ex-members could be charged for the costs of Multi-Value Projects approved before their departure. FERC approved that revision prospectively, holding that the revision imposed new obligations on withdrawing members and could not apply to Duke and American to charge them for the Multi-Value Projects. Other MISO Transmission Owners appealed, claiming that FERC departed from the reasoning of its prior orders. The Sixth Circuit denied a petition for review, stating that there is no presumption that costs for the Multi-Value Projects should be allocated up front. View "MISO Transmission Owners v. Federal Energy Regulatory Commission" on Justia Law

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Petitioners challenged the Commissions' approval of revisions to the rules governing the buying and selling of "capacity" for markets operated by PJM. The DC Circuit held that the Commission balanced the benefits of the revised rules against the increased costs and reached a reasoned judgment. Therefore, the Commission's decision was not arbitrary nor capricious. The court deferred to the Commission's interpretation of the Federal Power Act, 16 U.S.C. 824e, because its interpretation of the Act's requirements was reasonable; deferred to the Commission's balancing of competing concerns in setting a penalty rate; and rejected challenges to the default offer cap, the year-round capacity commitment, orders approving PJM's demand resource rules, and imposition of Capacity Performance penalties on resources that fail to perform due to unit-specific constraints. Accordingly, the court denied the petitions for review. View "Advanced Energy Management Alliance v. FERC" on Justia Law

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Statoil Oil & Gas LP appealed judgments dismissing without prejudice its actions against numerous defendants, seeking a determination of the proper distribution of oil and gas revenues from Williams and McKenzie County wells on land adjacent to the Missouri River and under Lake Sakakawea. It was undisputed that the United States claimed an interest in the property and, although the United States waived sovereign immunity regarding real property title disputes, those actions against the United States had to be brought and resolved in a federal court. The parties therefore agreed that joinder of the United States was not feasible for purposes of N.D.R.Civ.P. 19(a). The provisions of N.D.R.Civ.P. 19(b) come into play:"(b) When Joinder Is Not Feasible. If a person who is required to be joined if feasible cannot be joined, the court must determine whether, in equity and good conscience, the action should proceed among the existing parties or should be dismissed. Considering N.D.R.Civ.P. 19(b)(1), the district court noted the United States would be prejudiced to some extent by its absence in the proceedings because, although it would not be bound by a state court judgment, a judgment in favor of other mineral owners would cloud its record title to the disputed property. This could force the United States to institute a proceeding to protect its interests in the property, resulting in a waste of judicial and party resources. The trial court concluded there was a risk of substantial prejudice to the United States (including both its mineral interests and its sovereignty) if this matter proceeded in its absence, and therefore the first factor favors dismissal. The North Dakota Supreme Court affirmed, concluding the district court did not abuse its discretion in dismissing the actions because Statoil failed to join the United States as an indispensable party. View "Statoil Oil & Gas, LP v. Abaco Energy, LLC" on Justia Law

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The Colorado Supreme Court concluded that the statutory scheme property taxation of oil and gas leaseholds authorized the retroactive tax assessment in this case. Petitioner Kinder Morgan CO2 Company, L.P., operated oil and gas leaseholds in Montezuma County, Colorado. In 2009, the assessor for Montezuma County issued a corrective tax assessment on these leaseholds for the previous tax year, retroactively assessing over $2 million in property taxes, after an auditor concluded that Kinder Morgan underreported the value of gas produced at the leaseholds. Kinder Morgan appealed, arguing the assessor lacked authority to retroactively assess these taxes because Colorado law did not authorize a retroactive assessment when an operator has correctly reported the volume of oil and gas sold but has underreported the selling price at the wellhead. In affirming the court of appeals in this matter, the Supreme Court further concluded that the Board of Assessment Appeals did not err in determining that Kinder Morgan underreported the selling price by claiming excess transportation deductions, given Kinder Morgan’s relationship to the owner of the pipeline through which the gas was transported. View "Kinder Morgan CO2 Co., L.P. v. Montezuma Cty. Bd. of Comm'rs" on Justia Law

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The Oil Pollution Act (OPA), as confirmed by the Act's legislative history, grants to an OPA Responsible Party the right to receive contribution from other entities who were partially at fault for a discharge of oil. Specifically, a Responsible Party may recover from a jointly liable third party any damages it paid to claimants, including those arising out of purely economic losses. In a suit arising from a collision of two barges, the district court found both Settoon and Marquette Transportation were negligent. The Fifth Circuit held that Settoon could receive contribution from Marquette for its payment of purely economic damages, i.e., for the cleanup costs. The court also held that the district court's apportionment of fault was not clearly erroneous. Accordingly, the court affirmed the judgment. View "In re: Settoon Towing, LLC" on Justia Law

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The Water District appealed from the district court's judgment in a consolidated multidistrict litigation granting summary judgment to BP and Shell on the ground that the Water District's suit was barred by res judicata arising from 2002 and 2005 settlements. Claims against BP and Shell for MTBE contamination had been brought by the Orange County District Attorney (OCDA) in 1999 and were settled in 2002 and 2005 respectively. The Second Circuit vacated and remanded the Water District's claims against BP and Shell, holding that the Water District and OCDA were not in privity. View "In re Methyl Tertiary Butyl Ether (MTBA) Products Liability Litigation" on Justia Law