Court Approves Unleased Mineral Owner Suit Against Chesapeake - GoHaynesvilleShale.com2024-03-28T19:05:35Zhttps://gohaynesvilleshale.com/forum/topics/court-approves-unleased-mineral-owner-suit-against-chesapeake?commentId=2117179%3AComment%3A3812891&feed=yes&xn_auth=noI try and learn something new…tag:gohaynesvilleshale.com,2020-01-22:2117179:Comment:38803192020-01-22T01:42:10.332ZSteve Phttps://gohaynesvilleshale.com/profile/StevePorter
<p>I try and learn something new everyday. Today, this is it - never underestimate the power of the Commissioner of the La. Department of Conservation (not sure that's the correct title for these days).</p>
<p>In this case, the Plaintiff clearly compromised his legal position by agreeing to the well being drilled in the unit. Maybe that would have not made a difference in the end. But it clearly didn't help his case.</p>
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<p>I try and learn something new everyday. Today, this is it - never underestimate the power of the Commissioner of the La. Department of Conservation (not sure that's the correct title for these days).</p>
<p>In this case, the Plaintiff clearly compromised his legal position by agreeing to the well being drilled in the unit. Maybe that would have not made a difference in the end. But it clearly didn't help his case.</p>
<p></p> This is an interesting decisi…tag:gohaynesvilleshale.com,2020-01-14:2117179:Comment:38786422020-01-14T22:36:01.720ZRobert mcintyrehttps://gohaynesvilleshale.com/profile/Robertmcintyre
This is an interesting decision which has effects far beyond post production expenses. First, because Chesapeake produces, markets and sells the UMO’s gas and then controls the use of those proceeds to pay itself, it owes the UMO’s a fiduciary duty. This practice could also constitute a violation of the Louisiana unfair trade practices act exposing Chesapeake to treble damages.<br />
Further, this case deals with post production costs. There is a much more serious issue not addressed concerning…
This is an interesting decision which has effects far beyond post production expenses. First, because Chesapeake produces, markets and sells the UMO’s gas and then controls the use of those proceeds to pay itself, it owes the UMO’s a fiduciary duty. This practice could also constitute a violation of the Louisiana unfair trade practices act exposing Chesapeake to treble damages.<br />
Further, this case deals with post production costs. There is a much more serious issue not addressed concerning administrative expenses charged to a UMO. Steve P,
See Nunez v. Wainoc…tag:gohaynesvilleshale.com,2020-01-14:2117179:Comment:38786302020-01-14T21:50:28.810ZAndrewhttps://gohaynesvilleshale.com/profile/Andrew358
<p>Steve P,</p>
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<p>See <em>Nunez v. Wainoco 2, <a href="https://www.courtlistener.com/opinion/1096202/nunez-v-wainoco-oil-and-gas-co/">https://www.courtlistener.com/opinion/1096202/nunez-v-wainoco-oil-and-gas-co/</a></em></p>
<p>Steve P,</p>
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<p>See <em>Nunez v. Wainoco 2, <a href="https://www.courtlistener.com/opinion/1096202/nunez-v-wainoco-oil-and-gas-co/">https://www.courtlistener.com/opinion/1096202/nunez-v-wainoco-oil-and-gas-co/</a></em></p> Unless in LRS 30:10 the speci…tag:gohaynesvilleshale.com,2019-04-01:2117179:Comment:38147252019-04-01T05:14:09.317Zcasingpointhttps://gohaynesvilleshale.com/profile/casingpoint
<p>Unless in LRS 30:10 the specific language has ben changed, the operator owns the production from which he recovers his UMO costs. It is really irrelevant if the stock comes from pre production or post production. He owns it in proportion to the UMO acreage in the unit. </p>
<p>Apparently LRS 30:10 has been re-written twice recently, in 2012 and 2016. Does anyone know where to access the earlier versions?</p>
<p>The language I used above does indeed not appear in the current version, unless I…</p>
<p>Unless in LRS 30:10 the specific language has ben changed, the operator owns the production from which he recovers his UMO costs. It is really irrelevant if the stock comes from pre production or post production. He owns it in proportion to the UMO acreage in the unit. </p>
<p>Apparently LRS 30:10 has been re-written twice recently, in 2012 and 2016. Does anyone know where to access the earlier versions?</p>
<p>The language I used above does indeed not appear in the current version, unless I missed it. </p> Haynesville units are governm…tag:gohaynesvilleshale.com,2019-03-31:2117179:Comment:38147712019-03-31T00:42:44.935ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>Haynesville units are governmental sections. So not in the same forced pool. Not weird, the operator simply gets a subsurface easement if the owner of the adjacent section is not under lease. If the owner of the surface location is under lease, the lessee may provide the easement. As soon as the favored surface location for Haynesville horizontal wells was off the unit, all the operators provided subsurface easement rights as a professional courtesy as they all needed the ability to use…</p>
<p>Haynesville units are governmental sections. So not in the same forced pool. Not weird, the operator simply gets a subsurface easement if the owner of the adjacent section is not under lease. If the owner of the surface location is under lease, the lessee may provide the easement. As soon as the favored surface location for Haynesville horizontal wells was off the unit, all the operators provided subsurface easement rights as a professional courtesy as they all needed the ability to use off unit pads.</p>
<p></p> Again, as long as exploratory…tag:gohaynesvilleshale.com,2019-03-31:2117179:Comment:38145502019-03-31T00:05:40.896Zcasingpointhttps://gohaynesvilleshale.com/profile/casingpoint
<p>Again, as long as exploratory drilling is in progress, prescription is interrupted on both leases, assuming both leases are in the same forced pool. In not in the same pool, then yes, the operator would need a lease to continue.</p>
<p>Problems could arise where a horizontal passes through a dry zone on one landower (s) but hits the good stuff underneath the unit next door. How do you get it out of the ground through the dry hole without compensation to the landowners who have a dry hole?…</p>
<p>Again, as long as exploratory drilling is in progress, prescription is interrupted on both leases, assuming both leases are in the same forced pool. In not in the same pool, then yes, the operator would need a lease to continue.</p>
<p>Problems could arise where a horizontal passes through a dry zone on one landower (s) but hits the good stuff underneath the unit next door. How do you get it out of the ground through the dry hole without compensation to the landowners who have a dry hole? This is getting a little weird.</p> The lease language states "on…tag:gohaynesvilleshale.com,2019-03-30:2117179:Comment:38145892019-03-30T17:31:33.191ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>The lease language states "on the leaseed lands". The section next door is not on the leased lands. Petrohawk readily admitted this and the mineral owner gave them a new lease with some modest improvement in terms.</p>
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<p>The lease language states "on the leaseed lands". The section next door is not on the leased lands. Petrohawk readily admitted this and the mineral owner gave them a new lease with some modest improvement in terms.</p>
<p></p> <<<regulations and s…tag:gohaynesvilleshale.com,2019-03-30:2117179:Comment:38146602019-03-30T17:25:41.342Zcasingpointhttps://gohaynesvilleshale.com/profile/casingpoint
<p><span style="font-size: 12pt;"><<<regulations and standard lease terms fail to operate as intended in the era of horizontal development>>></span></p>
<p><span style="font-size: 12pt;">One need only to examine the intent of the parties of interest to settle that quandary. Bottom line IMHO, once a unit well is spud, prescription is interrupted.</span></p>
<p><span style="font-size: 12pt;"><<<regulations and standard lease terms fail to operate as intended in the era of horizontal development>>></span></p>
<p><span style="font-size: 12pt;">One need only to examine the intent of the parties of interest to settle that quandary. Bottom line IMHO, once a unit well is spud, prescription is interrupted.</span></p> A mineral lessor in a unit ha…tag:gohaynesvilleshale.com,2019-03-28:2117179:Comment:38138322019-03-28T02:34:49.351ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>A mineral lessor in a unit has a lease nearing the end of the primary term, no extension clause. The standard form lease language allows the lease to remain in effect past the primary term as long as operations are under way on the lands or those pooled with it in a drilling unit, i.e. a well is spud. However the surface location of the drill pad is in the adjoining section, not in the unit. The lease term expires while the vertical section of the well is drilling, i.e. before the well is…</p>
<p>A mineral lessor in a unit has a lease nearing the end of the primary term, no extension clause. The standard form lease language allows the lease to remain in effect past the primary term as long as operations are under way on the lands or those pooled with it in a drilling unit, i.e. a well is spud. However the surface location of the drill pad is in the adjoining section, not in the unit. The lease term expires while the vertical section of the well is drilling, i.e. before the well is turned horizontal and penetrates the section covered by the lease. Just one example of how regulations and standard lease terms fail to operate as intended in the era of horizontal development.</p>
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<p></p> My knowledge of Louisiana Min…tag:gohaynesvilleshale.com,2019-03-28:2117179:Comment:38140962019-03-28T02:19:08.756ZSteve Phttps://gohaynesvilleshale.com/profile/StevePorter
<p>My knowledge of Louisiana Mineral Law is dated, but I would be really surprised in an operator could obtain access to an unleased land/mineral owner for surface operations for a drill site. It would be tresspassing, and the Conservation Department can’t change that. The Department of Conservation can grant an operator to produce minerals from an unleased mineral owner within a unit. Surface operations are different.</p>
<p>My knowledge of Louisiana Mineral Law is dated, but I would be really surprised in an operator could obtain access to an unleased land/mineral owner for surface operations for a drill site. It would be tresspassing, and the Conservation Department can’t change that. The Department of Conservation can grant an operator to produce minerals from an unleased mineral owner within a unit. Surface operations are different.</p>