May, 2010

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Texas Court Upholds Lease Cancellation for Failure to Pay Shut-In Payments To Proper Party

The Energy Law Blog

By Kevin Connolly: In Nitschke v. Circle Ridge Production, Inc. , No. 12-09-00150CV, __ S.W.3d _ (Tex. App.—Tyler 5/5/2010), the Tyler Court of Appeals upheld a trial court’s findings of fact and conclusions of law with respect to the termination of an oil and gas lease for failure to pay shut-in royalty payments to the proper party. The case involved a dispute between the original lessee and a top lessee.

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U.S. Fifth Circuit Finds Contractual Claim Under JOA Not Impermissible “Collateral Attack”

The Energy Law Blog

By Robert L. Theriot In EOG Resources Inc. v. Chesapeake Energy Corp., No. 09-30362, __ F.3d __ (5th Cir. 4/29/10) , the Fifth Circuit reinstated EOG’s contractual claim against Chesapeake under the parties’ joint operating agreement (JOA). EOG claimed that Chesapeake had unilaterally drilled three wells in the parties’ pooled mineral leases in Bossier Parish, Louisiana, without first obtaining EOG’s written consent as required by their JOA.