Blog

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Our Oil & Gas Law Report blog is devoted to current legal issues and trends in the oil and gas industry. The blog is designed for readers to quickly and easily learn about the latest legal developments affecting producers, investors, transporters, land owners and governing organizations.

Recent Blog Posts

  • New Ohio regulations reduce minimum spacing requirements for horizontal oil and gas wells By Chris Baronzzi    The Ohio Department of Natural Resources – Division of Oil & Gas Resources Management (DOGRM) recently revised its rules governing spacing of horizontal oil and gas production wells. The new rules, which became effective on Oct. 10, 2019, will bring Ohio’s horizontal well spacing regulations in line with what accepted science and drilling data indicates is a more efficient and productive spacing for horizontal wells in Ohio. Under the prior version of Ohio Administrative Code §1501:9-1-04, which applied to... More
  • Reference to oil & gas royalty interest deemed sufficient under the Marketable Title Act By Jeremy Mercer and Devan Flahive    The Ohio Supreme Court recently settled an open question under Ohio’s Marketable Title Act (MTA), determining that a reference to the type of interest created and to whom it was granted is all that is necessary under the MTA to preserve the interest. And interestingly, despite the existence of the Dormant Mineral Act (DMA), the Supreme Court applied the MTA to an oil and gas interest. In Blackstone v. Moore, landowners filed a lawsuit against the... More
  • State Legislature exempts oil and gas landmen from real estate license requirements By Ryan Steele    On Dec.19, 2018, Gov. John Kasich signed SB 263 into law, which amends ORC 4735 to exempt oil and gas land professionals (landmen) from the licensure requirements imposed on real estate agents and brokers. The revisions to sections 4735.01 and 4735.023 introduce the concept of an “oil and gas land professional” (new ORC 4735.01(GG)), and exempts landmen from the definition of “real estate broker,” “real estate salesperson,” “foreign real estate dealer” and “foreign real estate salesperson” through new... More
  • New Ohio tax law clarifies and expands sales and use tax exemptions for the oil and gas industry By Mark Snider    Many thanks to Kevin Scott for his assistance in preparing this post. On June 14, 2018, Governor Kasich signed into law H.B. 430 which will go into effect in September of 2018. The bill clarifies the language covering sales and use tax exemptions for certain oil and gas industry participants. Specifically, the new law modifies the existing statute governing the sales and use tax exemption for property used directly in producing oil or gas. Following recent actions by the... More
  • West Virginia joins majority view on oil and gas leasing with new cotenancy statute By Devan Flahive    On March 5, 2018, the West Virginia Legislature passed new legislation known as the Cotenancy Modernization and Majority Protection Act, W. Va. Code § 37B-1-1 et seq. (Cotenancy Statute). This new Cotenancy Statute, which became effective June 3, 2018, is intended to facilitate oil and gas development of West Virginia properties that have numerous fractional oil and gas owners. It applies to tracts in which there are seven or more owners of the oil and gas in place,... More
  • Ohio Supreme Court rejects implied covenant to explore further By Chris Baronzzi    The Ohio Supreme Court’s latest oil and gas decision is good news for the industry. On Jan. 3, 2018, the Court decided Alford v. Collins-McGregor Operating Co., Slip Opinion No. 2018-Ohio-8, which held that under Ohio law, “there is no implied covenant to explore further separate and apart from the implied covenant of reasonable development.” Id. at ¶25. The facts are straight forward and did not seem to make much difference in the decision. The Plaintiff-appellant filed suit in... More
  • Federal district court finds that Ohio allows deduction of post-production costs from royalty payments required to be calculated “at the well” By Chris Baronzzi    Last week the Ohio Northern District Court, Eastern Division issued a decision in Lutz v. Chesapeake Appalachia, LLC, N.D. Ohio No. 4:09-cv-2256, 2017 U.S. Dist. LEXIS 176898 (Oct. 25, 2017), which involved a dispute about whether Ohio follows the “at the well” rule (which allows oil and gas royalty payments to be downward adjusted to account for a lessor’s pro rata share of post-production costs) or the “marketable product” rule (which does not allow producers to adjust royalty... More
  • Ohio Supreme Court to hear appeal on expansion of implied covenants to encompass deep rights By Ryan Steele    On March 15th, 2017, the Ohio Supreme Court accepted a discretionary appeal in Alford v. Collins-McGregor Operating Company, Washington App. No. 16CA9, 2016-Ohio-5082. The Alford appeal arises from the Washington County Court of Appeals, Ohio’s 4th Appellate District. In Alford, the 4th District declined to expand Ohio’s implied covenant of reasonable development to encompass unexplored, deep formations. The plaintiffs in Alford sought to forfeit their 1980 oil and gas lease as to all depths below the Gordon Sand formation.... More
  • Ohio appeals court requires landmen to be licensed as real estate brokers to negotiate oil and gas leases By Ryan Steele    On Feb. 17, 2017, the 7th District Court of Appeals upheld a Mahoning County Court of Common Pleas decision that ruled landmen must be licensed as real estate brokers to be compensated for negotiating oil and gas leases. In Dundics v. Eric Petroleum Corp., 2017-Ohio-640, the plaintiffs were landmen who had negotiated leases on behalf of the defendant operator. The landmen were promised $10 per leased acre and a 1 percent working interest in any wells placed on the leased acreage.... More
  • Ohio Supreme Court issues decision regarding post-production costs By Chris Baronzzi    This morning the Ohio Supreme Court issued a decision in Lutz, which arose when the federal Northern District Court of Ohio, Eastern Division, certified the following question of law to the Ohio Supreme Court: Does Ohio follow the “at the well” rule (which permits the deduction of postproduction costs) or does it follow some version of the “marketable product” rule (which limits the deduction of post-production costs under certain circumstances)? The Supreme Court initially accepted the certified question and... More