Waste: Statutory Cause of Action

摘要

Humble Oil & Refining Co., a predecessor in interest to Exxon Corp. and Exxon Texas ("Exxon") leases the mineral interest on several thousand acres in the Mary Ellen O'Connor Field, near Refugio, Texas, under leases that require royalty payments of fifty percent. Exxon also owns an interest in an adjacent tract with a substantially lower royalty obligation. As oil production on the property dwindles, Exxon attempts unsuccessfully to negotiate a reduction in its royalty obligation under the Mary Ellen O'Connor Field leases. Exxon gradually plugs and abandons wells on the property. After Exxon's lease expires, Emerald Oil & Gas, L.C. ("Emerald"), acting on behalf of its working interest owner, obtains the lease of the mineral interests on the property. Emerald and the royalty owners subsequently bring suit against Exxon, alleging Exxon engaged in a deliberate pattern of sabotaging the wells to prevent reentry that resulted in waste, pollution, economic loss, and loss of useful wells. Plaintiffs also allege that Exxon misrepresented the status of the wells and the procedures undertaken in its public filings with the Texas Railroad Commission. Emerald bases some of its causes of action on its alleged reliance on Exxon's public filings in determining whether to obtain the lease on the wells and other causes of action on several provisions in the Texas Natural Resources Code.