People and businesses involved in oil and gas exploration face many complex and unique legal issues in production, exploration, transportation, development, marketing, refining, and more. If you or your company is involved in the oil and gas business in Texas, Oklahoma, or New Mexico and has a legal issue, the oil and gas lawyers at Nix Patterson can help.
Oil and gas law refers to the statutes, regulations and case law that control oil and gas production. These laws determine who has the right to drill and extract oil and gas on a property and lay out the conditions that companies must follow when they extract oil and gas.
Oil and gas law is a mix of statutory law, common law, and administrative regulations that oversee the mining and harvesting of oil and gas in the United States.
Oil and gas attorneys represent individuals and entities who work in many aspects of oil and gas extraction and production. So many oil and gas companies have significant legal needs and often hire attorneys to handle their legal work. Also, many lessors (or mineral interest owners) in Oklahoma, New Mexico, and Texas hire attorneys to assist them with negotiating and drafting agreements.
The oil and gas industry mainly involves transactional law, but oil and gas disputes often require litigation. When there is a dispute, a lawsuit may be needed to resolve the matter. Nix Patterson oil and gas attorneys assist our clients in all areas of oil and gas exploration and litigation, including:
While different states’ laws differ, all oil and gas attorneys need to understand the rule of capture as well as the correlative rights rule. The rule of capture states that a property owner can capture and mine all oil and gas under the land. If an oil and gas resource runs on the property from adjacent land, the owner can capture it. The rule of capture encourages the property owner to explore potential oil and gas resources on their land because they can keep what is found.
The correlative rights rule requires the owner to do the work for oil and gas extraction without negligence or waste. For instance, the owner cannot be so eager to extract the minerals that they do it in a way that stops thorough exploration. So instead, the oil and gas attorney assists the client in doing business in a way that doesn’t violate the industry rules of conduct.
A great deal of oil and gas law involves writing lease agreements to mine oil and gas. The attorney must have an intricate understanding of what should be in an oil and gas lease so it benefits the client. For instance, a valid oil and gas lease must have a complete description of the land that will be leased, and the payment terms and lease length must be clear.
Oil and gas law also secures necessary state and federal permits before extraction begins. Usually, the oil and gas company must get a license from the Texas or Oklahoma state government to start work. If the drilling is on federal land or offshore, the federal government may need to issue permits. The attorney must understand which regulatory body to approach to ask for a permit and how to complete the permit application correctly for the oil and gas client.
Disputes over drilling obligations are a common recent legal issue in oil and gas. Many leases executed in the Permian and Eagle Ford shale plays involve some form of continuous drilling obligation. This means the lessee must drill a new well in a leased area or risk the lease being partially terminated. Disputes involving these drilling obligations will likely be ongoing for attorneys and their clients.
The oil and gas industry in the United States is regulated at the state and federal levels. In Texas, oil and gas regulation is handled by the Railroad Commission of Texas and the Texas Commission on Environmental Quality.
Nationally, the oil and gas industry is overseen by the Environmental Protection Agency (EPA), the Occupational Safety and Health Administration (OSHA), and the Department of the Interior (DOI).
If you’re interested in tapping oil and gas on a property, adhering to state and federal regulations is vital. Oil and gas attorneys can ensure you adhere to relevant laws and regulations.
Mineral rights are a common issue in the Oklahoma and Texas oil and gas industry. “Mineral rights” refers to your rights to the mineral deposits under the property surface. Several kinds of natural resources are included in mineral rights, including oil, gas, coal, precious metals, and more.
In some situations, owning the property also means you have mineral rights. However, this isn’t always true. In some cases, one person or entity can possess the property and another the mineral rights. This is common if they were sold or leased separately from the property on the surface.
Mineral rights can be passed down in several ways, such as by:
You can purchase mineral rights outright, or you can lease them for a period of time. This allows the owner to keep legal ownership. However, before you assume that you have mineral rights at your property, you should talk to an oil and gas attorney to determine if the mineral rights have been sold.
At Nix Patterson, we offer a complimentary case evaluation to understand your oil and gas legal needs. For more information, please contact the oil and gas attorneys at Nix Patterson now.
Nix Patterson only works on a contingency fee basis. Our clients pay us nothing unless we win. Schedule a free consultation today.
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