I just read the following & wonder does this affect existing leases now that were written in 2009 between royalty owners & oil companies?
“The Texas Supreme Court issued a narrow 5-4 opinion in Murphy Exploration & Production Co. — USA v. Adams on June 1, 2018, interpreting a common “offset” clause contained in a 2009 oil and gas lease. The majority held that the phrase “offset well” in that clause does not necessarily refer to a well that would protect the leasehold against drainage, but instead referred to a well drilled anywhere on the leased premises that was drilled to a depth required by the lease. The Court reached this conclusion based on interpreting that phrase in light of “surrounding circumstances” evidence of the discovery of the Eagle Ford and drainage patterns of horizontal shale wells. Four justices dissented in an opinion that, among other things, accused the majority of disregarding the commonly understood meaning of the phrase “offset well,” which is a well designed to protect the leasehold from drainage.
Sent from my smartphone. Please forgive any typos.”