Oil and Gas Law 6th Edition
Chapter 1 (1-177)
A. Historical Background
B. Physical Background
a. Origin
b. Accumulation and Occurrence
c. Petroleum Mechanics
d. Non-Traditional Resources
e. Types of Reservoir Drives
f. Types of Oil and Gas
C. Technological Background
a. Exploration Techniques and Exploration
b. Drilling a well
c. Completing a well and Primary Production
i. Kurth – On Fracing
d. Secondary and Tertiary Recovery
D. Introductory Notes of Land Descriptions
E. Ownership and Capture
a. Ad Coelum Doctrine
i. Del Monte v. Last Chance
b. Petroleum Ownership Theories
i. Kuntz Treatise
c. Rule of Capture and Correlative Rights
i. Kelly v. Ohio Oil
ii. Coastal O&G v. Garza
iii. People’s Gas v. Tyner
iv. Wronski v. Sun Oil
d. Ownership After Extraction
i. Chaplin v. Western Bridge
ii. Texas American v. Citizens Fidelity
e. Common Patterns of Ownership
f. A Further Look at Trespass and Related Claims
i. Geophysical Exploration and Trespass
1. Enron v. Worth
2. Kennedy v. General Geophysical
3. Grynberg v. Northglenn
ii. Dry Hole Trespass
1. Humble Oil v. Kishi
iii. Wet Hole Trespass
iv. Slander of Title
v. Kidd v. Hoggett
g. Loss of Mineral Ownership
i. Loss through Non-Use
1. Adverse Possession
a. Diederich v. Ware
2. Abandonment
3. Liberative Prescription
4. Dormant Mineral Interest Acts
a. Scully v. Overall
Chapter 2 The Oil and Gas Lease P. 177-396
A. Purpose of the Lease and Nature of the Rights Created
a. Purpose
b. Nature of the Leasehold Interest
c. Significance of the Classification of the Lease Interests
B. Granting Clause
a. Surface Uses Granted
i. Hunt Oil v. Kerbaugh
b. Substances Granted by the Lease
c. Lands and Interests Granted
d. Basic Principles of Federal O&G Income Taxation
e. State and Local Taxation
C. Habendum Clause: Duration of the Lease
a. Lease Primary Term
i. Maintenance by Delay Rental
1. Schwartzenburger v. Hunt Trust Estate
ii. Maintaining by Drilling
1. Breaux v. Apache Oil
b. Secondary Term: Extension and Maintenance
i. Production in Paying Quantities
1. Clifton v. Koontz
ii. Actual Production or Capability of Production
1. Stanolind v. Barnhill
2. Pack v. Santa Fe
c. Savings Clauses as a Substitute for Production
i. Shut in Royalty Clause
1. Freeman v. Magnolia
ii. Cessation of Production, Dry-Hole & Operations Clauses
1. Rogers v. Osborn
2. Perlman v. Pioneer Limited
D. Pooling Clause: Modifying the Granting, Habendum & Royalty Clauses
a. Exercising in Accordance with the Pooling Clause Terms
b. Good Faith Exercise of the Pooling Power
i. Amoco v. Underwood
ii. Pooling After Production
iii. Pooling Just Before Expiration of the Primary Term
iv. Gerrymandering
v. Pooling for Exploration and Orderly Development
c. Lease Limits on Pooling Authority
i. Anti-Dilution Provisions
ii. Pugh Clauses
iii. Retained Acreage Clauses
E. Royalty Payments
a. General Principles
b. Express Lease Royalty Obligations
i. Piney Woods v. Shell
c. Implied Lease Covenants which may affect royalties.
i. Implied Covenant to Market
ii. Implied Covenant to market at a reasonable time
iii. Implied Covenant to market at an appropriate price
1. Amoco v. 1st Baptist
iv. Implied Covenant to market and post-production costs
1. Piney Woods v. Shell (1984)
2. Garmin v. Conoco
d. Implied Covenant to protect against drainage
i. Amoco v. Alexander
e. Implied Covenant to drill
i. Implied covenant to test
ii. Implied covenant to develop
1. Superior Oil v .Devon
iii. Implied covenant to explore further
f. Implied covenant to operate diligently and properly
i. Baldwin v. Kubetz
g. Division Orders
i. Gavenda v. Strata Energy
h. Remedies for Failing to pay royalties
i. Cannon v. Cassidy
i. Miscellaneous Royalty Provisions
i. Casinghead Gas and Processed Gas
ii. Production on Which Royalties Are Due
iii. Free Gas Clauses
iv. Fixed Gas Royalties
Chapter 3 – Titles and Coneyances 397-609
Intro
A. Distinction between Mineral Interests and Royalty Interest
a. Nature of the Interest
i. Bodcaw v. Grande
ii. McSweyn v. Musselshell
b. Creation of Mixed Royalty Interests
i. Barker v. Levy
ii. French v. Chevron
iii. Anderson v. Mayberry
B. Shared Ownership of the Mineral Estate
a. Concurrent Ownership
i. Development by Co-Tenants
1. Law v. Heck
2. Prairie O&G v. Allen
ii. The Community Lease
1. Partition of Mineral Interests
a. Moesely v. Harrell
b. Successive Ownership & Non-Possessory Interests
i. Life Estates and Remainders
1. Welborn v. Tidewater
2. Hynson v. Jeffries
ii. Tenants for Years and Holders of Defeasible Fees
iii. Creditors
iv. Owners of easements, covenants and servitudes.
C. Terminable Interests
a. Archer County v. Webb
D. Executive Right in Mineral Interests
a. In Re Lee M. Bass
E. Meaning of Minerals and Names Substances
a. Grants and Reservations of Other Minerals
i. Moser v. US Steel
ii. Oklahoma Ex Rel v. Butler
b. *Ownership of Coalbed Methane Gas
i. Central Natural Resources v. Davis Operating
F. Conveyances and Reservations of Mineral and Royalty Interests
a. Size of Geographic Area: Catch All Clauses, Horizontal Severance and Related Issues.
i. S. Hiram Moore v. Greer
b. Size of Fractional Interests
i. Averyt v. Grande
c. Overconveyances: Duhig and its progeny
i. Duhig v. Peavy Moore Lumber
ii. Acoma Oil v. Wilson
d. Proportionate Reduction Clause
i. Texas Co. v. Parks
G. Conveyances of Interests in Leased Lands
a. Conveyances “Subject To” An Existing Lease
i. Hoffman v. Magnolia Petroleum
ii. Concord Oil v. Pennzoil
b. Non-Apportionment Doctrine
i. Japhet v. McRae
ii. Thomas Gilcrease Foundation v. Stanolind
c. Top Leasing
i. Hamm v. Bright
H. Effect of Pooling on Property Interests
a. Effect on Lessor’s Interests
i. Wagner & Brown v. Sheppard
b. Effect on Royalty and Related Interests.
i. London v. Merriman
c. Effect on Terminable Interests
i. Edmonston v. Home State O&G
I. Title Examination
Chapter 4 Oil and Gas Conservation Law and Regulation
A. Rule of Capture Revisited
B. Conservation Law and Practice
a. Introduction
i. Am. Institute of Mining Treatise
ii. Vance v. Wolfe
iii. Range Resources v. Jaken
b. Regulating Exploration, Drilling, Production, Completion and Plugging
i. Exploration and Permitting
ii. Well Spacing and Density
1. Model O&G Act.
2. Larsen v. OGCC
iii. Spacing and Density
1. Model O&G
2. Pattie v. OGCC
3. Exxon v. Railroad Commission
iv. Regulating Production Operations, Production and Marketing
1. Pickens v. Railroad Commission
2. Model O&G Act
3. Denver Production and Refining v. State
4. Model O&G Act
v. Regulating End Use
vi. Small Tracts and Compulsory Pooling
1. Intro
2. Judicial and Equitable Pooling
3. *Kansas: Allowable Adjustments and Acreage Attributable.
4. Texas Rule 37 Exceptions
a. Exceptions to prevent confiscation
b. Well Allowables
c. Mixed Interest Pooling Act
d. Carson v. Railroad Commission
5. Compulsory Pooling
a. Model O&G Act
b. Bennion v. ANR
c. Model O&G Act
d. Anderson v. Corporation Commission
vii. Unitization
1. Shortcomings
a. Anderson and Smith Treatise
2. Enhanced Recovery
3. Achieving Unitization
a. Anderson Treatise
b. Model O&G Act
c. Trees v. State OGCC
4. Unitization Liabilities and Obligations
5. Baumgartners v. Gulf Oil
Chapter 6 Contracts and Transfers by the Lessee - 912-1078
A. Lease Assignments
a. Legal Requirements and Drafting Considerations
i. Preston Exploration v. Chesapeake
ii. Petro Pro v. Upland
b. Rights and Obligation of Assignor/Assignee
i. Reynolds-Rexwinkle v. Petex
ii. Cook v. El Paso Natural Gas
c. Lessor Rights Against Assignee
i. OAG v. Desert Gas
ii. Kothe v. Jefferson
B. Support Agreements
C. Farmout Agreements
a. Structure and Tax Implications
i. Revenue Ruling
b. Drilling Obligations
i. Mantra v. Darcy
c. Retained Interests
d. Earned Interests
i. Westland Oil Dev. Co. v. Gulf
D. Financing O&G Transactions
a. Diligence Documents
i. Title Review
ii. Oil & Gas Leases
iii. JOAs
iv. Farm In – Farm Out
v. Hedging Agreements
vi. Lien Searches
vii. Environmental
b. Credit Agreements
c. Collateral Documents and Perfection of the Lease
i. Notes
ii. Mortgage and Deeds of Trust
iii. Pledge Agreements and Equity Securities
iv. Guaranties
v. Deposit Account Control Agreements
vi. Letters in Lieu of Transfer
vii. UCC-1 Financing Statements
E. Operating Agreements and Related Documents
a. Operator Authority and Responsibility
i. Shell Rocky Mountain v. Ultra
b. Non-Operator Liability for Costs
i. Initial Drilling
1. M&T v. Fuel Resources Development
ii. Additional Development
1. Blocker Exploration v. Frontier Exploration
iii. Ownership and Marketing of Production
1. Atlantic Richfield v. The Long Trusts
iv. Miscellaneous Provisions, Attachments and Exhibits
1. Tenneco v. Enterprise Products
F. Drilling and Service Contracts
a. Caza Drilling v. Teg O&G
b. Foreman v. Exxon
G. Gas Purchase Contracts
a. Martin Treatise
b. Manchester Pipeline v. People’s Natural Gas