Justia Energy, Oil & Gas Law Opinion Summaries

Through a series of assignments, Clovelly Oil Company and Midstates Petroleum Company, LLC, were parties to a 1972 joint operating agreement (JOA). The issue before the Supreme Court was whether a lease acquired by Midstates in 2008 was subject to the provisions of the JOA. Upon review, the Court found that the lease in question was not subject to the JOA, and reversed the appellate court and reinstated the trial court's ruling.View "Clovelly Oil Co. v. Midstates Petroleum Co., LLC" on Justia Law

The issue before the Supreme Court in this case involved a 1925 tax sale and the failure to give notice of the pending tax sale to the property owner. The specific issue in the present case was whether "Mennonite Board of Missions v. Adams," (462 U.S. 791 (1983)), could be applied retroactively to invalidate this 1925 tax sale. Plaintiffs, owners of oil, gas, and mineral interests, filed suit against four groups of record landowners including Pirate Lake Oil Corporation, the Mayronne Group, the Handlin-Jones Group, and the Zodiac Group, to determine the parties entitled to the proceeds of production. The Mayronne and Handlin-Jones Groups filed a motion for summary judgment, arguing the Zodiac Group had no interest in the property. The District Court granted the motion for summary judgment and dismissed the Zodiac Group’s claims of ownership in the property with prejudice. The Court of Appeal affirmed, finding the Zodiac Group’s ancestor in title was never the record owner of the property. Further, the Zodiac Group traced its ownership of the property to a 1925 tax sale, and there was no evidence the Sheriff provided notice of the sale to the record owner of the property, as required by the Fourteenth Amendment Due Process Clause under "Mennonite." Upon review, the Supreme Court found that "Mennonite" could not apply retroactively to invalidate the 1925 tax sale for lack of notice. Further, while the Zodiac Group’s ancestor in title was not the record owner of the property, any defect was cured by the five-year peremptive period of Article X, section 11 of the 1921 Louisiana Constitution. Accordingly, the Court reversed the judgments of the lower courts. View "Quantum Resources Management, LLC v. Pirate Lake Oil Corp." on Justia Law

The Wyoming Oil and Gas Conservation Commission approved Cimarex Energy Company's plan to reinject waste carbon dioxide and hydrogen sulfide into a producing natural gas formation in southwest Wyoming over the objection of Exxon Mobil Corporation. Exxon appealed. The district court affirmed the Commission's decision. The Supreme Court affirmed in part and reversed and remanded in part, holding (1) the Commission properly denied Exxon's petition for a rehearing; but (2) the Commission failed to provide sufficient findings of fact as to whether Cimarex's plan to reinject carbon dioxide and hydrogen sulfide would result in waste of natural gas and improperly interfere with Exxon's correlative rights. Remanded to the Commission to make appropriate findings of both basic and ultimate facts.View "Exxon Mobil Corp. v. Wyo. Oil & Gas Conservation Comm'n" on Justia Law

Northern Natural Gas Company (Northern) claimed several gas and energy companies (collectively, ONEOK and Lumen) wrongfully converted natural gas by purchasing gas from two producers (collectively, Nash and L.D.), which operated wells on land near Northern's underground natural gas storage field. ONEOK and Lumen filed third-party identification claims against Nash and L.D. Nash and L.D., in turn, asserted various claims against Northern, ONEOK, and Lumen. The district court granted summary judgment in favor of Nash and L.D. on the third-party identification claims, concluding that Northern lost title to its migrating storage gas, and thus, Nash and L.D. had title to the gas produced by wells located beyond property adjoining the certificated boundaries of Northern's gas storage field and purchased by ONEOK and Lumen. Before the court journalized its order, Northern expanded the certificated boundaries of its storage field, bringing the wells at issue within the expansion area. The district court denied Northern's motion to modify its summary judgment ruling but limited its ruling to matters prior to June 2, 2010. The Supreme Court affirmed, holding that by application of the rule of capture, Nash and L.D. possessed title to the gas produced from their wells before June 2, 2010. View "N. Natural Gas Co. v. ONEOK Field Servs. Co., LLC" on Justia Law

Appellant Catherine Lakey and twelve other homeowners owned property that bordered a parcel owned by Puget Sound Energy, Inc. (PSE) on which there was an electrical substation. The homeowners sued PSE and the City of Kirkland after PSE constructed a new substation on PSE property. The homeowners sought review of the trial court's decision to exclude testimony of their expert under the "Frye" rule, and the court's ultimate decision to grant summary judgment on behalf of PSE. Upon review, the Supreme Court concluded that the trial court improperly excluded the expert's testimony under the "Frye" rule but properly excluded it under the Rules of Evidence ER702. Furthermore, the Court reversed the trial court's decision with respect to their Land Use Petition Act (LUPA) claims, finding that LUPA did not apply to the homeowners' inverse condemnation claim. The Court affirmed the trial court in all other respects.View "Lakey v. Puget Sound Energy" on Justia Law

Three main issues were raised on appeal to the Supreme Court in this case: (1) whether a school district is liable for oil and gas severance taxes on its royalty interests derived from oil and gas production on sixteenth-section land (the chancellor ruled that it is not); (2) whether the statute of limitations restricts the time period in which a school district can seek a refund of severance taxes that it had paid erroneously (the chancellor ruled that a three-year statute of limitations applied to any refund claims); and (3) whether a school district is liable for administrative expense taxes on its royalty interests derived from oil and gas production on sixteenth-section land (the chancellor ruled that it is). Upon review of the applicable code and in consideration of the arguments of the parties to this case, the Supreme Court found that the chancellor's judgment should be affirmed in part and reversed in part: (1) school districts are not liable for oil and gas severance taxes on sixteenth-section royalty interests: school districts, as political subdivisions of the state, are not included within the definition of "persons" made subject to these taxes; (2) pursuant to the Mississippi Constitution, statutes of limitation in civil causes do not run against the state or its subdivisions; and (3) school districts are liable for administrative expense taxes on sixteenth-section royalty interests: "[t]hese assessments are 'fees,' not 'taxes'; the Legislature has expressly made the state and its subdivisions subject to these fees; and no constitutional provision or other law is violated by requiring school districts to pay them."View "Jones County School District v. Mississippi Department of Revenue" on Justia Law

The Department of Environmental Protection approved an application of Saddleback Ridge Wind, LLC for a permit to construct the Saddleback Ridge Wind Project, a wind energy development. The Board of Environmental Protection affirmed. Friends of Maine's Mountains, Friends of Saddleback Mountain, and several individuals appealed, arguing, among other things, that the Board abused its discretion when determining which nighttime sound level limit to apply to the applications. The Supreme Court vacated the Board's order related to nighttime sound requirements and remanded, holding that the Board failed to meet its statutory obligation to protect the health and welfare of the Project's neighbors and thus abused its discretion in approving Saddleback's permit applications.View "Friends of Maine's Mountains. v. Bd. of Envtl. Prot." on Justia Law

Petitioners and Respondents executed a land contract whereby Respondents agreed to sell a piece of property to Petitioners. After the land contract had been fully consummated, Respondents refused to tender a deed to Petitioners. Petitioners filed suit, seeking a delivery of a general warranty deed for the property, including all oil and gas rights. Two months later, Respondents tendered a deed to Petitioners reserving oil and gas rights. The deed was recorded on February 17, 2010. Petitioners moved for summary judgment, arguing that because the land contract did not contained any language indicating Respondents' intention to except oil and gas rights, any questions of interpretation should be resolved in favor of the grantees. The trial court granted summary judgment for Respondents, finding that when the deed was recorded, the land contract was merged in the deed and any cause of action based upon the contract was extinguished. The Supreme Court reversed, holding (1) the contract was unambiguous, and Respondents failed to establish any legally sufficient basis for varying its terms; and (2) therefore, Respondents were obligated to convey their title and interest to the property, including their vested oil and gas rights. Remanded for entry of summary judgment in favor of Petitioners.View "Spitznogle v. Durbin" on Justia Law

Through cold calls, defendants sold plaintiffs shares in oil and gas joint ventures in Texas, Alabama and Mississippi. Plaintiffs all signed agreements with forum selection clauses stating that courts in Dallas County, Texas would have exclusive jurisdiction should any disputes arising from the agreements arise. The ventures lost money, and plaintiffs sued in Colorado, raising violations of the Colorado Securities Act (CSA) and various other common-law claims. Defendants moved to dismiss all claims citing the forum selection clause. Plaintiffs argued on appeal that the clauses were void because they were unenforceable on public policy grounds. Upon review, the Supreme Court held that the forum selection clauses were valid, and that they requires the parties to litigate their claims in Texas. View "Cagle v. Mathers Family Trust" on Justia Law

SM Energy Company appealed a summary judgment declaring that A.G. Golden and other plaintiffs were entitled to a four percent overriding royalty interest in leases and lands covered by a 1970 letter agreement and ordering SM to pay amounts due to Golden and the other plaintiffs for these interests, and an order denying SM's motion to amend or for relief from the judgment. Upon review of the matter, the Supreme Court concluded the district court erred in ruling as a matter of law that SM through its predecessors in interest, expressly assumed an "area of mutual interest" clause in the 1970 letter agreement and in expanding the judgment to include unpled and unlitigated properties within the area of mutual interest. Furthermore, the Court concluded the court correctly ruled as a matter of law that SM owed Golden and the other plaintiffs retroactive royalty payments on production from a certain well located on the subject property. View "Golden v. SM Energy Company" on Justia Law