At the Well Weekly (v.3.6.2026)
- George A. Bibikos
- 21 hours ago
- 10 min read
Oil + Gas Update: Royalties, Title Disputes, and LNG Battles.
Since our last report, oil prices moved sharply higher as a result of the conflict in the Middle East, with Brent and WTI both crossing the $90 threshold, while natural gas prices inched upward but remained relatively steady amidst elevated storage draws. The national rig count ticked upward, with Marcellus activity edging slightly higher as well.
In pipeline and regulatory developments, courts addressed federal preemption of state pipeline shutdown orders; the limits of tribal sovereignty claims over interstate pipeline infrastructure; and condemnation authority for gas storage pipeline projects.
In Appalachia, courts addressed royalty deductions in coal leases; mineral deed reservations; plug-and-abandonment obligations for unknown wells; arbitration clause exclusions in royalty class actions; standing in well-pad land-use challenges; and class-certification requirements in royalty disputes.
In other regions, courts addressed overriding royalty interest expiration; administrative exhaustion in royalty claims; state commission production allocation authority; gas storage lease obligations; at-the-well royalty clauses; double-fraction mineral reservations; mineral versus wellbore interests; non-participating royalty interests; royalty disclosure obligations; venue in royalty disputes; NEPA review of federal leasing programs; LNG facility permitting; community property presumptions in mineral title disputes; and landowner standing in easement disputes.
Rig Counts, Spot Prices + Oil Prices
Rigs: National (🔺551); Marcellus (26); Utica/Point Pleasant (14)
Brent Crude: 🔺$92.69/bbl
West Texas Intermediate: 🔺$90.90/bbl
NYMEX: April 2026 @ 🔺~$3.09/MMBtu; 12-Month Strip @ 🔺~$3.73/MMBtu
Spot Prices: Henry Hub @ 🔺~$3.02/MMBtu; Appalachian Regional Avg. @ 🔺~$2.50/MMBtu
U.S. Natural Gas Storage: 1,886 Bcf (−132 Bcf, national)
Headlines & Holdings - Appalachia
Pa. Cmwlth. Ct. Confirms no ERA Problem in PUC’s Approval of NatGas Buildings. The Commonwealth Court of Pennsylvania concluded that the Pennsylvania Public Utility Commission complied with the Environmental Rights Amendment when approving a gas distribution company’s buildings and infrastructure over objections from the township and residents, holding that the buildings would not have an unreasonable environmental impact under the ERA and that the record supported the agency’s decision. Township of Marple v. Pennsylvania Public Utility Commission, --- A.3d ----, No. 1385 C.D. 2024, 2026 WL 261889 (Pa. Cmwlth. Feb. 2, 2026).
Fed. Ct. in PA Says Coal Lease Permits Deducts for Transportation and Marketing. A federal court in Pennsylvania held that a coal lease authorizes deductions from royalty for railway transportation and marketing costs, but fact issues remain about whether the parties orally modified the lease to calculate royalties based on “clean coal at the plant.” Melcroft Coal Company, Inc. v. Robindale Energy Services, Inc., --- F. Supp. 3d ----, No. 2:24-CV-707, 2026 WL 290994 (W.D. Pa. Feb. 4, 2026).
Fed. Ct. in Ohio Tackles Dispute over O+G Deed Reservations. In a mineral rights dispute, a federal court in Ohio confirmed after remand from the Sixth Circuit that a 1948 deed reserved oil and gas rights in favor of the plaintiffs and rejected the lessee’s theories that they are not bound by the prior reservation. Long Point Energy, LLC v. Gulfport Energy Corp., --- F. Supp. 3d ----, No. 2:20-CV-4644, 2026 WL 380597 (S.D. Ohio Feb. 11, 2026).
N.Y. Appellate Court Says Oil Co. Responsible for P&A of Unknown Wells. In a dispute over P&A responsibility under New York law, a state appellate court confirmed a DEC determination that an oil company must plug 19 previously unknown wells discovered during inspections, holding that oil and gas wells are not personal property under applicable New York statutes governing P&A obligations and that the lessee’s control over mineral rights is sufficient regardless of whether the lessee drilled the wells. In re Thomas A. Miller v. Mahar, 2026 N.Y. Slip Op. 00744, --- N.Y.S.3d ----, 2026 WL 379620 (N.Y. App. Div. Feb. 11, 2026).
Fed. Ct. in Pa. Enforces Arbitration Clauses to Narrow O+G Royalty Class. In a royalty class action, a federal court in Pennsylvania granted the defendant’s motion to enforce class definition exclusions, holding that leases containing arbitration clauses must be excluded from the certified class. Rupert v. Range Res. – Appalachia, LLC, --- F. Supp. 3d ----, No. 2:21-CV-1281, 2026 WL 517009 (W.D. Pa. Feb. 25, 2026).
Pa. Cmwlth. Ct. Says Objector Lacks Standing to Challenge Land Development Approvals for O+G Well Pad. In a local land-development dispute, the Pennsylvania Commonwealth Court upheld local land-use approvals for a well site and concluded that an objector lacked standing to claim that the movement of a surface location of the well approved by DEP necessitated a new approval process. Protect PT v. Penn Twp., --- A.3d ----, No. 1254 C.D. 2024, 2026 WL 603246 (Pa. Cmwlth. Mar. 4, 2026).
Fed. Ct. in Ohio Declines Class Certification in Royalty Dispute. In a royalty dispute, a federal court in Ohio denied a bid by landowners to certify a class action, holding that the plaintiff failed to establish commonality under Rule 23(a) or predominance of common questions under Rule 23(b)(3) because the royalty provisions varied materially among the putative class leases such that whether the lessee breached any given contract would require individualized, lease-by-lease factual determinations. Kirkbride v. Antero Resources Corp., --- F. Supp. 3d ----, No. 2:23-CV-3212, 2026 WL 632326 (S.D. Ohio Mar. 6, 2026).
Headlines & Holdings - Beyond Appalachia
Kansas Ct. App. Says ORRI Expired with Dead O+G Lease. A court of appeals in Kansas held that an overriding royalty interest attached to a 1980 oil and gas lease expired when operations under the lease ceased and that the ORRI holder failed to demonstrate any in the Reynolds-Rexwinkle or Campbell cases that would keep the override alive despite lease expiration. William C. Story v. Spiral Energy Corp., --- P.3d ----, No. 128,346, 2026 WL 252919 (Kan. Ct. App. Jan. 30, 2026).
Colo. Fed. Ct. Says Royalty Owner Must Exhaust Admin Remedies. A federal court in Colorado dismissed the plaintiffs’ claim for underpaid royalties, holding that the plaintiffs failed to exhaust administrative remedies through the Colorado Energy and Carbon Management Commission (formerly the Colorado Oil & Gas Conservation Commission) and reasoning that, even in bona fide contract interpretation disputes, the agency must first determine its own jurisdiction. Richard Parry v. Simcoe LLC, --- F. Supp. 3d ----, No. 25-CV-00838-PAB-CYC, 2026 WL 266531 (D. Colo. Feb. 2, 2026).
ND Supremes Say Production Allocation Order Exceeds NDIC’s Authority. The North Dakota Supreme Court vacated an order from the North Dakota Industrial Commission that allocated production from a well in a lease-line spacing unit to a section outside the spacing unit, holding that NDIC exceeded its authority. Garaas v. North Dakota Industrial Commission, --- N.W.3d ----, 2026 ND 25, 2026 WL 303563 (N.D. Feb. 5, 2026).
Kansas Ct. Says No Breach of “Principal Dwelling” Clause in Gas Storage Lease. A court of appeals in Kansas held that a gas storage lessee complied with a “principal dwelling” clause in a 1950 gas storage lease by providing free gas to the owner of a principal dwelling on the property; the plaintiffs did not have a principal dwelling to claim a right to free gas; and a 1969 agreement did not modify the lease to remove the principal dwelling requirement. Richard C. Smoots v. Southern Star Central Gas Pipeline, Inc., --- P.3d ----, No. 127,158, 2026 WL 320240 (Kan. Ct. App. Feb. 6, 2026).
Fed. Ct. in Louisiana Says Gas Storage Company Has Condemnation Authority. In a condemnation action, a federal court in Louisiana granted a preliminary injunction authorizing immediate property access for pipeline construction, holding that Black Bayou Gas Storage possessed the authority to condemn servitudes on the subject property and met all requirements for immediate access to begin construction, maintenance, and operation of pipelines associated with its proposed salt dome storage project. Bayou Black Gas Storage LLC v. Lucky Draw LLC, --- F. Supp. 3d ----, No. 2:25-CV-02140, 2026 WL 396545 (W.D. La. Feb. 12, 2026).
Tex. App. Ct. Sends Back Dispute Over Mineral vs. Wellbore Interest. In a dispute over mineral ownership following a tax sale, a Texas appellate court held that the tax deed is ambiguous and sent the case back to the trial court to resolve fact issues over whether the deed conveyed full mineral or wellbore-only interests. Moore v. 1789 Minerals Fund I, LP, --- S.W.3d ----, No. 06-24-00080-CV, 2026 WL 437794 (Tex. App.—Texarkana Feb. 17, 2026).
Tex. App. Ct. Addresses O+G Royalty Disclosure Statute. In a dispute between landowners and an oil and gas operator over alleged violations of the royalty payment information requirements of Texas Natural Resources Code Section 91.502, a court of appeals in Texas held that the operator did not violate the statute by excluding certain transportation costs on check stubs and upheld the denial of the royalty owners’ judgment NOV motion. Davis v. Aethon Energy Operating LLC, --- S.W.3d ----, No. 12-24-00336-CV, 2026 WL 471825 (Tex. App.—Tyler Feb. 18, 2026).
Okla. Fed. Ct. Transfers Royalty Underpayment Suit to Texas. In a royalty dispute alleging underpayment and nonpayment of oil and gas royalties, a federal court in Oklahoma denied the defendants’ motion to dismiss for improper venue but granted their motion to transfer, holding that the Southern District of Texas is the more convenient forum because lease performance is in Texas, key witnesses and evidence are located there, and Texas law likely governs the substantive issues. Kalkman Habeck Co. v. APA Corp., --- F. Supp. 3d ----, No. 25-CV-32-DES, 2026 WL 540116 (E.D. Okla. Feb. 26, 2026).
Tex. App. Ct. Says Trial Court Misconstrued “At the Well” Royalty Clause. In a royalty interpretation dispute, a Texas appellate court reversed and remanded a $15.8 million jury verdict in favor of landowners, holding that the lease provides for oil royalties payable “at the well”; and trial court erred in construing the lease’s royalty clause as requiring valuation at “one-fifth of market value on the day of sale” rather than the “market price of such 1/5th part of such oil at the wells as of the day it is run to the pipe line.” Devon Energy Prod. Co. v. Oliver, --- S.W.3d ----, No. 13-25-00131-CV, 2026 WL 530284 (Tex. App.—Corpus Christi Feb. 26, 2026).
D.C. Fed. Ct. Upholds NEPA Challenges to Wyoming O+G Lease Project. In an environmental challenge to BLM’s approval of a 5,000-well oil and gas project in Wyoming’s Powder River Basin, a federal court in DC credited the petitioners’ claims that certain aspects of the project approval require additional environmental analysis. Powder River Basin Res. Council v. U.S. Dep’t of the Interior, --- F. Supp. 3d ----, No. 22-CV-2696 (TSC), 2026 WL 555013 (D.D.C. Feb. 27, 2026).
Tex. App. Ct. Says Confirms Mineral Reservation in “Double Fraction” Dispute. On remand from the Texas Supreme Court, a court of appeals upheld a trial court order confirming that a 1924 deed reserving “one-half of one-eighth” of all mineral rights meant the grantors kept a 50% mineral interest alongside a one-sixteenth royalty interests and that stare decisis and “law of the case” compelled adherence to those rulings. Navigator Grp. v. Van Dyke, --- S.W.3d ----, No. 11-24-00007-CV, 2026 WL 545548 (Tex. App.—Eastland Feb. 27, 2026).
Wisc. Fed. Ct. Stays Enbridge Line 5 Pipeline Shutdown Order Pending Appeal. In a trespass and public nuisance action brought by the Bad River Band of Lake Superior Chippewa against Enbridge Energy, a federal court in Wisconsin stayed its own pipeline shutdown order pending the Seventh Circuit’s resolution of an appeal, finding that the potential devastating impact on energy prices, local economies, and foreign relations with Canada warranted a stay while the appellate court addresses unsettled questions of law regarding the balance between energy infrastructure and tribal sovereignty. Bad River Band of the Lake Superior Tribe of Chippewa Indians v. Enbridge Energy Co., --- F. Supp. 3d ----, No. 19-CV-602-WMC, 2026 WL 560028 (W.D. Wis. Feb. 27, 2026).
Tex. App. Ct. Sends Back Tragic Wellsite Electrocution Case. In a wrongful death action arising from the electrocution of a wellsite pumper by a sagging high voltage power line, a Texas appellate court upheld a denial of summary judgment against the electric utility, holding that the utility did not conclusively establish that the decedent qualified as a “person responsible” under Chapter 752 of the Texas Health and Safety Code. Oncor Elec. Delivery Co. LLC v. Ramirez, --- S.W.3d ----, No. 01-24-00088-CV, 2026 WL 545756 (Tex. App.—Houston [1st Dist.] Feb. 27, 2026).
Fed. Ct. in Tex. Says NPRI Holder has a Floating Royalty. In an interpleader action to determine royalty interests, a federal court in Texas determined that the holder of a non-participating royalty interest is entitled to a “floating” royalty on production from a well calculated in accordance with the lease royalty, reasoning that the NPRI holder gets a proportional share of whatever royalty the lessee pays the lessor rather than a fixed fraction of gross production. Saddleback Exploration, LLC v. Brunelle, --- F. Supp. 3d ----, No. 4:23CV3091, 2026 WL 564302 (S.D. Tex. Feb. 27, 2026).
La. Ct. App. Upholds Coastal Use Permits for LNG Facility. In an environmental permitting challenge, a Louisiana appellate court affirmed the Office of Coastal Management’s decision to grant coastal use permits for the construction and operation of LNG facilities, rejecting arguments that OCM failed to consider environmental concerns, impacts on fisherman, or alternative sites with lesser impacts and did not violate the public trust doctrine under the state’s constitution. Healthy Gulf v. Secretary, La. Dep't of Natural Res., --- So. 3d ----, No. 2025-551, 2026 WL 601956 (La. App. 3 Cir. Mar. 4, 2026).
Tex. App. Ct. Says Mineral Owner Rebutted Community Property Presumption. In a title dispute, a Texas appellate court held that mineral owners successfully rebutted the community property presumption under Texas law to demonstrate separate property ownership of the mineral estate and rejected arguments that the doctrines of presumed grant, adverse possession, or estoppel by deed compelled a different result. Griffin Energy Law, PLLC v. Billingsley, --- S.W.3d ----, No. 11-24-00174-CV, 2026 WL 616105 (Tex. App. Mar. 5, 2026).
N.M. App. Ct. Says Landowners Lack Standing in Easement Fight. In an easement dispute, a New Mexico appellate court concluded that landowners lacked standing to claim rights on property as purported equitable title holders or as successors to an access agreement, holding that the landowners failed to preserve those arguments for appeal. Pinasco v. El Paso Natural Gas Co., LLC, --- P.3d ----, No. A-1-CA-41319, 2026 WL 622744 (N.M. Ct. App. Mar. 5, 2026).
La. Supremes Say Port Authority Condemnation for LNG Use is Unlawful. In a constitutional challenge to an expropriation, the Louisiana Supreme Court held that a public port authority may not lawfully condemn private property for the purpose of leasing it to a private company for that company’s exclusive development and use of LNG facilities because such a taking does not serve a public purpose and is therefore prohibited by the Louisiana Constitution. Plaquemines Port Harbor & Terminal Dist. v. Nguyen, --- So. 3d ----, No. 2025-00827, 2026 WL 632408 (La. Mar. 6, 2026).
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