Louisiana – We’re getting a little case history on what can be considered “reasonably prudent for the mutual benefit of the operator and the lessor”. How this plays out across the country will be a big question for mineral owners who have inherited leases that were signed decades ago. The next item that mineral owners will begin challenging in states with less established laws will likely be what constitutes “paying quantities”.
“A state district court ruling that partially canceled the mineral lease of a DeSoto Parish landowner has been overturned by a state appeal court.”"The landowner had sued Questar Exploration and Production Co., seeking dissolution of the lease, for failing to develop lower producing levels in areas that include the Haynesville Shale gas development in northwest Louisiana, according to The Times of Shreveport.”
” ‘The record does not support a finding that Questar failed to act as a reasonably prudent operator for the mutual benefit of itself and its lessor’ as required by state law, the court said.”
Read the full news release at washingtonexaminer.com