Justia Energy, Oil & Gas Law Opinion Summaries

Articles Posted in Wyoming Supreme Court
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The Supreme Court reversed the judgment of the district court ruling that North Silo Resources, LLC, the mineral lessee in this case, did not have standing to quiet title or to claim breach of its lease and that North Silo's mineral lease encumbered fifty percent of the mineral estate, holding that the district court erred as to both issues.North Silo brought an action seeking a declaratory judgment and to quiet title in certain minerals underlying property located in Laramie County and bringing a breach of lease claim against the mineral owner. The district court concluded (1) North Silo did not have standing to quiet title or to claim breach of its lease; and (2) North Silo's mineral lease encumbered only fifty percent of the mineral estate. The Supreme Court reversed, holding (1) North Silo had standing to quiet title and to assert a claim for breach of lease; and (2) North Silo's lease encumbered 100 percent of the mineral estate. View "North Silo Resources, LLC v. Deselms" on Justia Law

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The Supreme Court affirmed the judgment the district court denying TEP Rocky Mountain LLC's (TEP RM) motion to dismiss this action, granting summary judgment to Record TJ Ranch Limited Partnership (TJ Ranch) on several issues, and ruling that TEP RM had breached the parties' agreements, holding that there was no error.TJ Ranch brought this action seeking payment under a surface use and damage agreement governing oil and gas development and production of ranch lands. TEP RM filed a motion to dismiss for lack of personal jurisdiction, which the district court denied. The court ultimately concluded that TJ Ranch was entitled to payment. The Supreme Court affirmed, holding that the district court (1) correctly exercised personal jurisdiction over TEP RM; (2) did not clearly err in its findings; and (3) did not abuse its discretion in denying TEP RM's motions to stay. View "TEP Rocky Mountain LLC v. Record TJ Ranch Limited Partnership" on Justia Law

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The Supreme Court affirmed in part and reversed in part the decision of the Wyoming Board of Equalization (Board) concluding that WPX Energy Rocky Mountain, LLC was entitled to deduct some of its "reservation fees," holding that the Board erred in interpreting the plain language of Wyo. Stat. Ann. 39-14-203(b)(vi)(C) in its decision.At issue on appeal was whether and to what extent WPX was entitled to deduct "reservation fees" under the "netback" severance tax valuation method, section(vi)(C), for natural gas production years 2013-2015. The Board concluded that WPX was entitled to deduct some of its reservation fees. The Supreme Court reversed in part, holding (1) the statute allows WPX to fully deduct its pipeline reservation fees for months when some but not the full reserve capacity of gas was transported on that pipeline; (2) the statute does not allow WPX to deduct its Bison Pipeline reservation fees for months when it shipped no gas on the pipeline; and (3) the Board's conclusion that WPX cannot deduct any portion of its Bison Pipeline reservation fees it used to recoup pipeline construction costs was contrary to the plain language of the statute and the Bison agreement. View "Wyo. Department of Revenue v. WPX Energy Rocky Mountain, LLC" on Justia Law

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In this eminent domain dispute, the Supreme Court reversed the first order of the district court allowing EME Wyoming, LLC access to approximately 52,000 acres of land located primarily in Goshen County and affirmed the second order permanently barring EME from using survey information it collected to file permits to drill (APD) with the Wyoming Oil and Gas Conservation Commission (WOGCC), holding that the district court erred in part.EME sought access to land owned by four limited liability companies (collectively, the BRW Group) for the purpose of gathering data to evaluate the property's suitability for condemnation. The BRW Group denied EME's request, believing that EME sought access to the lands solely to collect data with which to file APDs, which is not a proper purpose under the Wyoming Eminent Domain Act. The district court allowed EME to access the property to survey and gather data but restricted it from using the survey information to file APDs. The Supreme Court reversed in part, holding (1) EME should not have been permitted access to the property because it did not make the required showing for access to the BRW Group's property; and (2) therefore, the data EME collected to file APDs was not lawfully in EME's possession, and EME could not use the data for any purpose. View "BRW East, LLC v. EME Wyoming, LLC" on Justia Law

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The Supreme Court affirmed the judgment of the district court dismissing two lawsuits brought by Black Diamond Energy of Delaware, Inc. (BDED) in an attempt to challenge the forfeiture of its bonds by the Wyoming Oil and Gas Conservation Commission, holding that the complaint in Case No. 2017-0074 was outside the scope of 30-5-113(a) and that the complaint in Case No. 2018-0011 was brought in the wrong venue.BDED, an oil and gas exploration company, secured a Wyoming oil and gas lease by posting bonds with the Commission and the Wyoming Office of State Lands and Investments. After the Commission ordered the bonds forfeited, BDED did not seek administrative review but, instead filed these lawsuits claiming that certain statutes authorized the direct action. The district court dismissed both lawsuits on the ground that BDED had failed to comply with the Wyoming Administrative Procedures Act. The Supreme Court affirmed but on different grounds, holding (1) BDED's complaint against the Commission in Case No. 2017-0074 was not properly brought pursuant to Wyo. Stat. Ann. 30-5-113(a); and (2) BDED did not bring its Wyoming Governmental Claims Act complaint in Case No. 2018-0011 in the proper venue. View "Black Diamond Energy of Delaware Inc. v. Wyoming Oil & Gas Conservation Commission" on Justia Law

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The Supreme Court reversed the judgment of the Wyoming Oil and Gas Conservation Commission approving only one out of two applications filed by Exaro Energy III, LLC seeking the approval of adjacent drilling and spacing units (DSUs) in the Jonah Field, holding that the Commission's denial of Exaro's other application was arbitrary and capricious.At a contested case hearing the parties agreed that the evidence presented would apply to both applications. At the hearing's conclusion, the Commission found as to both applications that Exam had met its burden of proof and provided evidence satisfying the statutory requirements for the establishment of a DSU. However, the Commission approved one application and denied the other. The Supreme Court reversed in part, holding (1) substantial evidence supported the Commission's finding that Exaro's evidence satisfied the statutory requirements for establishment of a DSU in both applications; and (2) the Commission's decision to grant only one of the applications was arbitrary and capricious. View "Exaro Energy III, LLC v. Wyoming Oil & Gas Conservation Commission" on Justia Law

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The Supreme Court reversed in part and affirmed in part the judgment of the district court deciding that a form of the accommodation doctrine governed to resolve the parties' dispute over priority of rights between mineral developers, holding that the BLM was not an indispensable party and that law of the case principles applied.The parties in this case were Berenergy Corporation, which owned rights to both federal and private oil and gas, and Peabody Powder River Mining, LLC, which held federal coal leases. These minerals overlapped. In Berenergy I, the Supreme Court determined that the BLM was a necessary party to the proceedings dealing with competing federal leases and remanded the case. The private oil and gas lease (the Thornburg lease) was not appealed or decided in Berenergy I. On remand, the district court concluded that it did not have subject matter jurisdiction as to the lands underlying the Thornburg lease without the presence of the BLM. The court then applied the law of the case in deciding that a form of the accommodation doctrine governed to resolve the parties' dispute on the overlapping minerals. The Supreme Court held (1) the BLM was not an indispensable party to the lease dispute; and (2) law of the case principles applied. View "Berenergy Corp. v. BTU Western Resources, Inc." on Justia Law

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The Supreme Court affirmed the district court’s order on summary judgment motions and order after bench trial in this dispute arising from an ill-conceived business conveyance plan during a downturn in the oil market, holding that the district court did not err or abuse its discretion in any respect.Three Garland brothers, who had separate entities providing specialized services to the oil industry, formed a company with their companies as members and the Garlands individually as members. Alex Mantle was president of the company. Mantle and the Garlands later entered into a memorandum of understanding (MOU) providing that Mantle and his wife would buy the company, but Mantle backed out of the deal. The Garlands liquidated the company, and this litigation followed. The district court disposed of some claims on summary judgment and resolved the remainder after a bench trial. The Supreme Court affirmed, holding (1) the Garlands and their entities did not abandon their counterclaims; (2) the MOU was an enforceable contract; (3) the district court correctly dismissed the Mantles’ fraud claim; (4) the district court correctly concluded that some conveyances by the Garlands fit the definitions of a fraudulent conveyance; (5) the elements for LLC veil-piercing were absent; and (6) the Garlands did not owe Mantle a duty of good faith. View "Garland v. Mantle" on Justia Law

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At issue was whether this case presented a justiciable issue when the Supreme Court could not render a decision binding on a federal agency and could only offer an advisory opinion that may or may not ultimately bind the parties.Berenergy Corporation, which produced oil from several sites under oil and gas leases granted by the United States Department of the Interior, Bureau of Land Management (BLM), sought a declaratory judgment that the terms of its BLM oil leases provided it with rights superior to any obtained by Peabody Energy Corporation through its coal leases. The district court granted in part and denied in part both parties’ motions for summary judgment. Both parties appealed. The Supreme Court remanded the case for further proceedings before the district court, holding (1) Congress intended that the issues raised by Berenergy be decided by the Secretary of the Interior or its BLM designees; (2) there was no express consent by the federal government for the Secretary or the BLM to be made a party to suits such as this for the purpose of informing a congressionally approved decision by the district court; but (3) the court nonetheless remands this case for an evaluation of whether a federal agency may participate in this suit. View "Berenergy Corp. v. BTU Western Resources, Inc." on Justia Law

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The Supreme Court affirmed the Board of Equalization’s decision affirming the ruling of the Wyoming Department of Revenue against PacifiCorp, Inc., which sought a ruling that its purchases of certain chemicals used in the process of generating electricity in coal-fired electrical generation facilities in Wyoming qualified for either the manufacturers’ sales tax exemption or the wholesalers’ sales tax exemption. The court held (1) The Board erred when it concluded that PacifiCorp is not a manufacturer under Wyo. Stat. Ann. 39-15-105(a)(iii)A); (2) the Board did not err when it held that certain chemicals necessary to treat water and sulfur dioxide emissions during the coal combustion processes that generate electricity are not “used directly” to generate electricity and are therefore not exempt from sales tax under section 39-15-105(a)(iii)(A); and (3) the Board did not err when it held that PacifiCorp’s purchases of certain chemicals and catalysts do not constitute wholesale purchases exempt from taxation under section 39-15-105(a)(iii)(F). View "PacifiCorp, Inc. v. Department of Revenue" on Justia Law