Defendant takes over an oil, gas, and mineral lease on a 449.57 acre tract situated within a larger 5,834 acre parcel. Plaintiff originally granted this lease in 1952 to defendant's predecessor in interest. In 2002, plaintiff sends defendant a letter demanding the release of the lease for failure to reasonably develop. Plaintiff files suit in 2005, after the parties are unable to resolve the dispute. Plaintiffs complaint centers around defendant's failure to conduct a 3-D seismological survey, which could have aided in the development of the leases. Defendant argues that the 2002 letter failed to comply with the notice and opportunity-to-cure requirements of Louisiana law. The district court rules in favor of plaintiffs and awards damages. The court also awards lost leasing revenues based on the entire 5,834 acre parcel. On appeal, the defendant focuses on plaintiff s alleged failure to allow defendant a reasonable amount of time for performance. Defendants also argue that the "more probable than not" standard used by the trial court in determining plaintiffs lost leasing opportunities is the incorrect standard. Held: affirmed in part, vacated and remanded in part. The court rules that the three years between the 2002 letter and the 2005 suit is a reasonable amount of time for defendants to perform. The standard for determining whether to award lost leasing opportunities is the "more probable than not" standard. The district court did not clearly err in determining that plaintiff would have been able to lease the property more than once had it been able to seismically survey it prior to 2006. However, the court vacates the judgment awarding consequential damages for lost leasing and seismic revenues on the entire 5,834 acre parcel. No Louisiana jurisprudence or scholarly work indicates the possibility of consequential damages beyond the scope of the leased parcel. The court rules that the district court's ruling on this issue was without adequate ground or relevant precedent.
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