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• Office of Conservation Rules for Groundwater Evaluation and Remediation at E&P Sites Incorrectly Published By Esteban Herrera, Jr. The July 20, 2010 Louisiana Register contained a notice from the Office of Conservation, Louisiana Department of Natural Resources that purported to promulgate rules amending Statewide Order 29-B to add a new Chapter 8 on procedures for evaluation and remediation of groundwater at E&P sites. Conservation’s Web site on July 20, 2010 contained a “final” version of the SERP Manual that was part of the proposed rules.  In a memorandum dated July 20, 2010 sent to interested parties, the Commissioner of Conservation said the July 20 notice on these proposed rules had been “unintentionally and incorrectly published” in the Louisiana Register as a final rule.  The memorandum states that Conservation does not consider the proposed rules “to be final or in effect at this time.”  Look for future information on these proposed rules.     ....
• Is Act 312 Applicable to My Operation? By Victor J. Suane, Jr. In 2006, the Louisiana Legislature enacted Louisiana Revised Statute 30:29 (“Act 312”) to provide a procedure for judicial resolution of claims for environmental damage to property. The provisions of Act 312 are applicable whenever there is “any litigation or pleading making a judicial demand arising from or alleging environmental damage” involving “contamination resulting from activities associated with oilfield sites or exploration and production (“E&P”) sites,” regardless of whether claims for remediation arise under the Louisiana Mineral Code or Civil Code. La. R.S. 30:29(I)(1).Though the constitutionality of Act 312 was upheld by the Louisiana Supreme Court in M.J. Farms, Ltd. V. Exxon Mobil Corp., 07-2371 (La. 2008), 998 So.2d 16, there may be some uncertainty as to which types of oil and gas activities fall under the purview of Act 312. Specifically, under Act 312, environmental damage is defined as any ....
• Louisiana Supreme Court Reaffirms Availability of Concursus Procedure for Royalty Payors, But Leaves Questions Concerning Provisions of the Mineral Code Governing Claims for Failure to Pay Royalties Unanswered By Linda S. Akchin On Friday, April 9, 2010, the Louisiana Supreme Court (1) reversed the Third Circuit Court of Appeal’s decision in Cimarex Energy Co. v. Mauboules (2), in which the Circuit Court held that (1) a royalty interest vendors’ oral assertion to a mineral lessee that the royalty interest vendee fraudulently inserted a prescription interruption provision in the royalty deed, and that therefore the royalty interest had reverted back to the vendors, is not a reasonable basis for the mineral lessee to initiate a concursus proceeding to determine the ownership of royalty payments because the innocent third party purchaser of the royalty interests is protected by the public records doctrine; and (2) the mineral lessee is liable not only for the royalties paid into the registry of the court, but also for an additional sum equal to double the amount of royalties paid into the registry of the court, as damages. The Third Circuit decision represented a ....
• Office of Conservation Proposes Rules for Groundwater Evaluation and Remediation at Exploration and Production Sites By Len Kilgore and Esteban Herrera In the January 20, 2010 Louisiana Register, the Office of Conservation, Louisiana Department of Natural Resources issued a Notice of Intent to amend Statewide Order 29-B to incorporate new rules for the evaluation and remediation of groundwater conditions at exploration and production sites. The proposed rules can be found at this link.   As part of the proposal, Conservation has published a draft manual entitled “Exploration and Production Waste Site Evaluation and Remediation Procedures Manual” or “SERP Manual.”   A copy of the SERP Manual can be found here.  Conservation will accept comments on the proposal through March 8, 2010.   A public hearing on the proposal is scheduled for March 1, 2010, at 9:00 a.m. (CST).   Anyone with interests involving energy exploration and production sites should carefully review the proposal. ....
• Louisiana Supreme Court Holds That Act 312 is Applicable to Legacy Lawsuits and is Constitutional - M.J. Farms, Ltd. v. Exxon Mobil Corporation, No. 07-CA-2371 by Katherine K. Green and Richard D. McConnell There are scores of oilfield contamination cases, coined “legacy lawsuits,” in which landowners claim that their property has been contaminated by historical oil and gas exploration and production operations. Legacy lawsuits are a means for plaintiffs to potentially obtain large jury verdicts to remediate property. Plaintiffs, however, are not required to use their monetary awards towards the remediation of their property. In 2006, the Louisiana Legislature, in response to windfall jury verdicts, lack of remediation obligations on landowner plaintiffs, and the adverse effect of those events on oil and gas operators in the State, enacted Louisiana Revised Statute 30:29 (“Act 312”). Act 312 reflects the Legislature’s concern that the State’s natural resources were not being protected under then-existing laws.  The constitutionality of Act 312 was recently challenged in M.J. Farms, ....
• Louisiana's Third Circuit Court of Appeals Upholds District Court's Dismissal of Legacy Oil Field Plaintiff's Contract and Tort Claims In LeJeune Brothers, Inc. v. Goodrich Petroleum Co., L.L.C., et al. by Laura L. Hart The 16th Judicial District Court granted a well operator’s motion for summary judgment and exception of no right of action and dismissed all of a property owner’s claims in a pending legacy oilfield suit. The Louisiana Third Circuit Court of Appeal upheld the trial court’s decision in LeJeune Brothers, Inc. v. Goodrich Petroleum Co., L.L.C., et al., 2006-1557 (La.App. 3 Cir. 11/28/07), __ So. 2d __, 2007 WL 4178946, rehearing denied (1/9/2008).    LeJeune Brothers, Inc. (“LeJeune”), the property owner, claimed that the Goodrich Petroleum Company, L.L.C. (“Goodrich”), a company whose predecessor had operated an oil and gas well on the property at issue, was liable to LeJeune for damages arising in tort and in contract, punitive damages, as well as damages for claims arising under the Mineral Code. Goodrich’s predecessor had operated pursuant to a mineral lease that had been executed with ....
• Grefer Judgment Vacated by Recent U.S. Supreme Court Decision by Laura L. Hart The U.S. Supreme Court granted Exxon Mobil Corporation’s (“Exxon Mobil”) Petition for a Writ of Certiorari (2006 WL 1786680, 75 USLW 3009, 6/29/2006) and vacated the punitive damages award granted in the Grefer suit. See, Exxon Mobil Corporation v. Grefer, Joseph, et al., 05-1670 __ S.Ct. __, 2007 WL 559870 (2/26/2007).          Plaintiffs claimed that their property had been contaminated with naturally occurring radioactive material (“NORM”) as a result of the pipe cleaning operations conducted thereon. A jury rendered judgment for the plaintiffs and awarded $56.145 million in compensatory damages, $145,000 in general damages, $56 million in restoration costs, and $1 billion in exemplary/punitive damages. The Louisiana Fourth Circuit Court of Appeal affirmed the awards of compensatory damages, general damages, and damages awarded for restoration costs, but reduced the $1billion award for ....
• Cameron Parish Court Sets Aside Jury Verdict Awarding Property Damages by Esteban Herrera, Jr. On January 31, 2007, a Louisiana district court in Cameron Parish set aside a jury verdict from two months earlier that awarded $57 Million for wetlands losses allegedly caused by decades of surface water discharges of produced water. In its January 31, 2007 Ruling of the Court in the Dore Energy, Corporation v. Carter-Langham, Inc., et al case, the court concluded that the landowner could not sue the sublessee under the mineral lease at issue because the sublessee had concluded its operations under that lease prior to the Louisiana Mineral Code becoming effective.   The court found the landowner-plaintiff had no privity of contract with the sublessee-defendant. The court also found that Act 312 of the 2006 Regular Session of the Louisiana Legislature applied to the plaintiff's claims, reversing an earlier procedural ruling in the case. Act 312 creates certain procedures in lawsuits involving claims of contamination resulting from ....
• Kean Miller Adds 12 Attorneys in Admiralty & Maritime, Construction, and Energy Practice Groups - New Orleans Office Triples in Size Kean Miller is pleased to announce that 12 lawyers, formerly in the Admiralty & Maritime, Construction, and Energy practice areas with Lemle & Kelleher, LLP, have joined the firm in the New Orleans office. "We are very excited to welcome these distinguished attorneys to our law firm. They are an outstanding resource for our clients. Our offices are located in Louisiana's major port cities --- New Orleans, Baton Rouge and Lake Charles -- and this esteemed group brings over 150 years of combined experience in maritime issues, admiralty law, marine insurance, oil & gas, drilling and exploration, pipelines, construction, and energy law to our clients." said Gary A. Bezet, managing partner of the 121-lawyer firm. The new group from Lemle & Kelleher nearly triples the size of Kean Miller's New Orleans office from 7 attorneys to 19 attorneys. The strategic acquisition builds on Kean Miller's position as the largest law firm in the Capital Region, and strengthens Kean Miller's regional ....
• Oilfield Pollution Litigation Update By Richard S. Pabst Writ applications have been filed with the Louisiana Supreme Court in two oilfield pollution cases that have the potential to dramatically impact the scope of the numerous legacy lawsuits currently pending throughout the state. In the case of Dore Energy Corporation v. Carter-Langham, Inc. et al., 2005-C-1582, on application for writ of certiorari from the Louisiana Third Circuit Court of Appeal, 2004-CA-1373 (La. App. 3rd Cir. 5/4/05), on appeal from the 38th Judicial Court, Cameron Parish, both the plaintiff and defendants have filed for writs as a result of the decision of the Louisiana Third Circuit Court of Appeal as to the issue of when does a mineral lessee's duty to restore the leased premises arise. In this case, the Third Circuit in part overruled a trial court ruling granting defendants' exception of prematurity which barred plaintiff from proceeding with its claims for restoration damages for property subject to a mineral lease still in effect. The Dore ....
• Post-Katrina Energy and Environmental Briefings from Kean Miller As a service to the community and its clients, Kean Miller will present a Post-Katrina Energy Industry Forum on Thursday, October 13th. In addition, the firm will host its Louisiana Environmental Forum on Friday, October 14th. These two important industry events are part of a week-long breakfast briefing series designed to provide innovation, insight and ideas for business and industry in Louisiana. These breakfast briefing events will be held at Drusilla Place, 3482 Drusilla Lane (Jefferson Highway at I-12 in Baton Rouge). Powering Up: A Discussion about the Future of the Louisiana Energy Industry Thursday, October 13th 7:15 a.m. - 9:30 a.m. Networking Breakfast 7:15 a.m. - 8:00 a.m. Katrina's Effect on the Energy Industry in Louisiana 8:00 a.m. - 9:00 a.m. Panelists: Don Briggs, Louisiana Independent Oil & Gas Association; Dr. David Dismukes, LSU Center for Energy Studies; Jim Porter, Louisiana Mid-Continent Oil & Gas Association; Dane Revette, La. Dept. of Economic Development, ....
• Louisiana In-House Counsel Rule Deadline Approaching By Lolly White In-house counsel who are employed in Louisiana but are not licensed to practice law here have until July 1, 2005 to file an application for limited licensure to practice under the Louisiana Supreme Court's new In-House Counsel Rule. Louisiana Supreme Court Rule XVII, Section 14, provides that a lawyer who is admitted and authorized to practice law in another state or territory may receive a limited license to practice law in this state when the lawyer is employed in Louisiana as a lawyer exclusively for a corporation, its subsidiaries or affiliates and/or a business which consists of activities other than the practice of law if the lawyer has filed an application for a limited license with the Committee on Bar Admissions. The Committee on Bar Admissions is comprised of 15 active members of the Louisiana State Bar Association who are appointed by the Louisiana Supreme Court. Click here for the application for Limited Licensure As In-House Counsel. This application, ....
• Fourth Circuit Upholds Lower Court's Award of Compensatory Damages, Reduces Punitive Damage Award in Property Restoration Case By Dwayne Johnson The Louisiana Fourth Circuit, in a decision sure to be appealed, recently upheld a lower court's award of compensatory damages - and reduced the lower court's punitive damage award - as a result of the defendants' alleged contamination of the plaintiffs' land with naturally occurring radioactive material (NORM). Grefer, et al. v. Alpha Technical, et al., 2002-CA-1237 (La. App. 4th Cir. 3/31/05); appeal from, Civil District Court, Orleans Parish. At issue was an approximately 33-acre tract owned by the plaintiffs in Harvey, Louisiana. The tract had been leased for use as a storage and cleaning facility for oil field pipe. Even though the tract had a value of $1.5 million (at most), the Fourth Circuit affirmed the jury's award of $56 million to restore the property to its former condition. The Fourth Circuit rejected the defense's contention that no restoration should have been required for those portions of the tract where NORM levels were at or below the NORM ....
• Court Wrestles With Oilfield Operator Obligations During Ongoing Operations For several years now, some landowners have been suing oil and gas operators concerning the condition of the land subject to a mineral lease. One Louisiana court recently struggled with the issue of when a landowner/lessor can sue a lessee under a mineral lease to remediate the property. On May 4, 2005, in the Dore Energy case, the Louisiana Third Circuit Court of Appeal concluded that a plaintiff's claims under a mineral lease are premature to the extent they involve an obligation under the mineral lease "to restore lands on which operations are ongoing." To the extent the claims involve lands upon which operations have been completed, the court concluded the landowner's claims are not premature. The court also found that prudent operator claims under Article 122 of the Louisiana Mineral Code are not premature. The court overruled the lower court's grant of an exception of prematurity with respect to plaintiff's claims in the case based upon theories of negligence, breach of contract, ....
• Louisiana Supreme Court Clarifies Mineral Lessee's Surface Restoration Obligations in School Board vs. Castex Energy By Trey McCowan Amicus curiae brief filed by Kean Miller Partners Bill Jarman and Linda Akchin for the American Petroleum Institute, the Louisiana Mid-Continent Oil & Gas Association, and the Louisiana Independent Oil & Gas Association. Summary: In Terrebonne Parish School Board vs. Castex Energy, et al., the Louisiana Supreme Court has held that a mineral lessee has no implied obligation to backfill oilfield access canals when the oil company's lease granted an express right to dredge canals and where there is no evidence that the oil company lessees exceeded the rights granted to them under the lease or acted unreasonably or negligently in dredging the canals. Article 122 of the Louisiana Mineral Code only imposes a duty to restore the surface to its original condition where there is evidence of unreasonable or excessive use of the surface of leased premises.In what can be considered good news for the oil and gas industry in Louisiana, on January 19, 2005, the Louisiana Supreme Court ....