Justia Energy, Oil & Gas Law Opinion Summaries

The issue this case presented to the Supreme Court involved mineral rights and royalties associated with a production well located on a certain tract of land owned by the plaintiffs in Terrebonne Parish. Two conveyances were at issue: a 1966 mineral deed and a 1992 cash sale. The plaintiffs asserted the 1966 mineral deed did not create a valid mineral servitude and, consequently, sought to be declared as owning 100% of the mineral rights since their purchase of the subject property by act of cash sale in 1992, and demanded to be awarded the royalties due from June 29, 1997, until the well stopped producing sometime in 2001 or 2002. Plaintiffs further asserted a violation of the Louisiana Unfair Trade Practices Act based on the allegation that various acts of the defendants amounted to a tortious conspiracy to deprive the plaintiffs of the royalties due them. The trial court ruled in the plaintiffs’ favor, finding the 1966 deed did not create a valid servitude over the subject property, plaintiffs were the owners of the mineral rights as of the 1992 purchase, and the defendants’ conduct amounted to unfair trade practices. The appellate court reversed and vacated the judgment, finding that the 1966 mineral deed had created a valid mineral servitude and that the 1992 act of cash sale had placed the plaintiffs on notice that the mineral rights to the property had been previously conveyed. The appellate court then remanded the case for consideration of the remaining issues associated with any rights the plaintiffs may have acquired from settlements with predecessor mineral interest owners in 2001 and 2005. After its review of the case, the Supreme Court affirmed the court of appeal: the 1966 mineral deed was sufficiently specific to identify the property to be conveyed and, thus, to create a valid mineral servitude and to place third parties on notice of the existence of that servitude. Plaintiffs did not acquire the mineral rights to the subject property via the 1992 warranty deed. Furthermore, the actions of the defendants did not rise to the level of an unfair trade practice within the meaning of the act. View "Quality Environmental Processes, Inc. v. St. Martin" on Justia Law

In 1967, Severt Kvalheim conveyed certain real property to Gordon Holsti by warranty deed. Kvalheim reserved fifty percent of the mineral rights for himself. That same year, Kvalheim executed a will devising to each of his heirs a one-eighth interest in his estate. Kvalheim died in 1969. In 2007, Gordon Holsti conveyed the surface estate to his sons (the Holstis). Believing Kvalheim’s mineral interest had lapsed and been abandoned because of nonuse, the Holstis published a notice of lapse of mineral interest in the official county newspaper. When no one filed a statement of claim asserting ownership of the mineral interest severed from the property, the Holstis brought a quiet title action. The circuit court ruled that the Holstis were the owners of the entire mineral interest, concluding (1) Kvalheim’s mineral interest had been abandoned under section S.D. Codified Laws 43-30A-2, -3; and (2) the Holstis gave proper notice of the lapse of the mineral interest even though they did not serve notice of the lapse on Kvalheim’s heirs. The Supreme Court reversed, holding that the mineral interests were not abandoned under section 43-30A-2. Remanded. View "Holsti v. Kimber" on Justia Law

This case concerned three rivers which flow through Montana and then beyond its borders. At issue was whether discrete, identifiable segments of these rivers in Montana were nonnavigable, as federal law defined that concept for purposes of determining whether the State acquired title to the riverbeds underlying those segments, when the State entered the Union in 1989. Montana contended that the rivers must be found navigable at the disputed locations. The Court held that the Montana Supreme Court's ruling that Montana owned and could charge for use of the riverbeds at issue was based on an infirm legal understanding of the Court's rules of navigability for title under the equal-footing doctrine. The Montana Supreme Court erred in its treatment of the question of river segments and portage and erred as a matter of law in relying on evidence of present-day primarily recreational use of the Madison River. Because this analysis was sufficient to require reversal, the Court declined to decide whether the State Supreme Court also erred as to the burden of proof regarding navigability. Montana's suggestion that denying the State title to the disputed riverbeds would undermine the public trust doctrine underscored its misapprehension of the equal-footing and public trust doctrines. Finally, the reliance by petitioner and its predecessors in title on the State's long failure to assert title to the riverbeds was some evidence supporting the conclusion that the river segments over those beds were nonnavigable for purposes of the equal-footing doctrine. Accordingly, the judgment was reversed. View "PPL Montana, LLC v. Montana" on Justia Law

In 2006, Plaintiffs entered into a five-year oil and gas lease covering 47 acres in Ross Township, Ohio, and granting Chesapeake exclusive rights to “all oil and gas and their constituents” for $5.00 per mineral acre per year and a royalty on production. The lease provides for extension, if “Operations” are being “conducted on the Leasehold, or on lands pooled, unitized or combined with all or a portion of the Leasehold.” In 2011, Chesapeake submitted drilling-permit applications for property that did not include Plaintiffs’ property. Later, Chesapeake filed a “Declaration and Notice of Pooled Unit,” consisting of 21 properties, including Plaintiffs’ property, and declared that “operations and/or production … anywhere within the Unit shall be deemed to be operations and/or production on each separate tract sufficient to extend and maintain each included lease in the Unit.” It specified that production from the unit would be allocated among all leases in the unit proportional to the surface area of each lease. Plaintiffs sought a declaration that the lease expired; Chesapeake filed a counterclaim. The district court ruled in favor of Plaintiffs, concluding that Chesapeake’s actions did not extend the lease because the lease required that a permit application pertaining to the leased property or a property already unitized with the leased property, be filed before the expiration of the lease. The Sixth Circuit reversed and remanded. View "Henry v. Chesapeake Appalachia, LLC" on Justia Law

G&M filed suit against BP, asserting that it was a co-owner of both the pumping station and the land on which it sits and seeking an accounting for all revenue and profit that BP made from the pumping station. The district court granted summary judgment for BP where BP contended that the St. Julien Doctrine prescribed G&M's claim and contested G&M's assertion of co-ownership. The court concluded that the St. Julien Doctrine did not apply in this case where the bare existence of the pumping station did not demonstrate G&M's consent or acquiescence to a servitude. Nor could G&M's inaction in the expropriation action serve as the basis for finding this final element of the St. Julien Doctrine. Because G&M never acquired an ownership interest in the pumping station, the resolution of this issue turned on whether those profits were the "civil fruits" of the co-owned Tract. The district court reversed and remanded to the district court to further consider whether the profits were civil fruits of the Tract and, if so, whether G&M was therefore entitled to an accounting. View "Gulf and Miss. River Transp. Co., Ltd. v. BP Oil Pipeline Co." on Justia Law

Plaintiffs filed suit against Chesapeake seeking an injunction and damages based on claims arising from the drilling and operation by Chesapeake of three natural gas wells on surface property owned by plaintiffs. Chesapeake owns lease rights to minerals beneath plaintiffs' surface property and the property rights of both parties ultimately flowed from two severance deeds that originally split the surface and mineral estates of the 101 acres of land plaintiffs owned. The only issue on appeal was whether the district court erred when it granted summary judgment for Chesapeake on plaintiffs' claim for common law trespass. The court concluded that the district court was correct to hold that creating drill waste pits was reasonably necessary for recovery of natural gas and did not impose a substantial burden on plaintiffs' surface property, that creation of the pits was consistent with Chesapeake's rights under its lease, was a practice common to natural gas wells in West Virginia, and consistent with requirements of applicable rules and regulations for the protection of the environment. Accordingly, the court affirmed the judgment of the district court. View "Whiteman v. Chesapeake Appalachia, LLC" on Justia Law

Plaintiffs filed suit against GenOn, on behalf of a putative class of at least 1,500 individuals who own or inhabit residential property within one mile of GenOn’s 570-megawatt coal-fired electrical generation facility in Springdale, Pennsylvania. The complaint asserted state tort law claims, based on ash and contaminants settling on plaintiffs’ property. The district court dismissed, finding that because the plant was subject to comprehensive regulation under the Clean Air Act, 42 U.S.C. 7401, it owed no extra duty to the members of the class under state tort law. The Third Circuit reversed, holding that the plain language of the Clean Air Act and controlling Supreme Court precedent indicate that state common law actions are not preempted. View "Bell v. Cheswick Generating Station, Genon Power Midwest, L.P." on Justia Law

Plaintiffs filed suit on behalf of themselves and other similarly situated landowners who used agents in an effort to lease oil and gas rights in Mercer County. When the transactions did not go as planned, plaintiffs sued an oil and gas company, Halcon, alleging breach of agreement and the duty of fair dealing. After Halcon claimed that the agents were “necessary parties,” plaintiffs decided to file direct claims against the agents, which destroyed diversity jurisdiction. Plaintiffs intended to pursue all of their claims in state court. Halcon argued that it did not oppose joining agents, agreed that the all claims would benefit from being heard in a single proceeding, but asserted that the case should proceed in federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d)(2), (d)(2)(A), (d)(5)(B), because discovery had begun and there were ongoing ADR activities. The district court dismissed without prejudice. Plaintiffs filed in state court, with some changes. Halcon then removed the state court action to the same federal district court, which again remanded, citing the “home state” exception to subject matter jurisdiction under CAFA. The Third Circuit affirmed, citing CAFA’s “local controversy” exception because the case relates to Pennsylvania owners and their land. View "Vodenichar v. Halcon Energy Props., Inc." on Justia Law

REX was unsuccessful in privately obtaining easements from defendants to install an interstate natural-gas pipeline authorized by the Federal Energy Regulatory Commission (FERC) under a coal mine in Ohio and had to condemn the easement, 15 U.S.C. 717f. REX built the pipeline and gas began flowing in 2009. Defendants believed that safety concerns regarding the pipeline would delay its mining permits and accelerated its mining, resulting in unanticipated costs associated with inefficient mining techniques. In valuing the easement, the district court determined that the defendants suffered no compensable damages to its coalmining operations as a result of the pipeline. The Sixth Circuit affirmed, stating that FERC found as a matter of fact that the pipeline would not compromise mining and that the two operations could co-exist. View "Rockies Express Pipeline, LLC v. 4.895 Acres of Land, More or Less" on Justia Law

Plaintiffs, a group of Mississippi Gulf Coast residents and property owners, alleged that emissions by energy companies contributed to global warming, which intensified Hurricane Katrina, which, in turn, damaged their property. The court concluded that the district court correctly held that res judicata barred plaintiffs' claims because the district court's judgment in Comer I was final and on the merits. Because true res judicata compelled good repose and barred plaintiffs' claims, the court need not address whether collateral estoppel applied or decide plaintiffs' other claims. Accordingly, the court affirmed the judgment. View "Comer v. Murphy Oil USA Inc, et al" on Justia Law