Thursday, June 2, 2011

Texas Railroad Commission Gets One Right

Texas Railroad Commission Examiner rules against Chesapeake Operating. Here is a PFD (Proposal for Decision) against Chesapeake Operating which denies a Rule 37 request for two cases. The denial is due to a lack of legal notice as determined by a RRC Legal Examiner. In this particular case, there were several possible protestants who could not be reached via snail mail. Procedure in this case is to notify the parties involved via a “newspaper of general circulation.” Chesapeake chose the “Forth Worth Commercial Recorder”. After all, who DOESN’T get the Ft. Worth Commercial Recorder? In short, the legal examiner determined that this publication was not legally sufficient as notice. The examiner goes on to cite case law in Texas to justify his opinion and even mentions the 14th Amendment (due process). We would also suggest consulting the 5th Amendment of the Bill of Rights, specifically the taking of private property without just compensation, something routinely done during Rule 37 rulings.

While the Commissioners themselves may well reverse this examiners opinion, or Chesapeake may simply be allowed to post notification in an appropriate newspaper, we applaud the Commission examiner for his well researched opinion. It has never been the intent of FMCAUD to “stick it to anyone”, but we do expect fair (that means industry has to lose a few now and then) and honest hearings in Austin when private property is at stake. Just maybe, this is a start.

15 comments:

Anonymous said...

This sounds all so familiar--the part the the operator has claimed that they have notified all the mineral rights owners. One particular operator in Flower Mound took the liberty of showing some mineral rights owners' names on the Pooling list who were NOT leased. Guess they wanted to save them the time? Wished we had known this particular legal examiner with the RRC last year, when we were all told that it was okay that the operator had arbitrily used mineral rights owners' names without their consent OR leases.

Anonymous said...

Was that on some of the PR Smith leases?

FMCAUD said...

This ruling was not for any Rule 37 in Flower Mound.

Anonymous said...

FMCAUD--you are correct that it was not regarding any of the Rule 37 protests. This was an application to drill. Between the permitting department and an attorney with the RRC, they told a few of us that the operator had 10 business days to clear up their "error." It took well over 10 business days--more like two and a half months, because the operator had to re-negoitiate expired leases with the mineral rights owners. The RRC continued to accept the application, considering the new Pooling list as an "amended" application, thus technically allowing the operator a "vested" status with the Town of Flower Mound.

Anon 8:16 a.m. this must have jumped out at you, as you are correct!

Anonymous said...

How can Titan continue their operations? My lease has expired and I'm not signing a new one this time around. I have not received a royalty check. How is this legal?

Anonymous said...

Cherokee Horn and Titan never did get enough people to sign leases. That is why there will be many Rule 37's needed to drill on Hillard. We may be talking double digits!!!! That is why they re-filed with the TRC and made the units smaller so it would look like less people were protesting. Yes, it is legal. Not ethical.
Cherokee Horn lied, oops I mean mislead, many who signed in the beginning and those people don't want to resign.
If Titan was smart, they would cut their losses and pack up and leave. Numerous Rule 37's have to be costly.

Anonymous said...

I've heard that there are some expired-lessors who are organizing a group to contest the validity of the leases, has anyone else heard this? I would assume that these are people just looking for more money. That is certainly their right if the leases have in fact expired. It is their property. I know most of leases were signed in early 2008 with 3 year terms so a lot of them must have expired already.

Anonymous said...

Regarding an operator's fee to file a Rule 37 exception, does anyone know if $50K per filing is correct?

Sounds like a new walking campaign to educate again, so those who do not want to lease or renew an expired lease are in the know.

Anonymous said...

My lease is expiring and there is no way I will sign again. The so called "mailbox" money is not worth the mess and crap that comes with it. One of my neighbors selling their home couldn't get a single person to look at it because of the drilling. They finally sold but had to drastically drop their price and sell the minerals with it.
Titan, the answer is No No No!!!!!! Don't come a knockin'

Anonymous said...

Titan is not a good neighbor!!! I heard they don't even have their own money. It is all venture capital. Which I believe means someone else is footing the bill. What happens if they get cut off? What kind of mess will we be stuck with?

Anonymous said...

I hate to beat a dead horse but folks we have the old council (pre May 2010 which included Smith, Levenick, Dixon, and Wallace, not NFL) to thank for the Hillard site. NO MATTER WHAT YOU HAVE BEEN TOLD! Just go back and listen to the pre-January 2010 meetings.

Please, please, please remember that next May!!!!!!

Anonymous said...

Anon 6:21 p.m. is correct that we need to be on watch next election season. We do know for a fact that our new Councilmember Stephenson employed Jody Smith's former consultant, a Republican political strategist, to transform her from an liberal Obamanite to the "Independent Voice." Six degrees of separation from Smith is NOT a good thing and we all need to improve our memories.

Anonymous said...

@ Anon 6:57 PM - interesting info, was this a new revelation? Why not share before the election?

Anonymous said...

Anon 8:54 PM Only wished that we had known before the election. There were a few in Smith's camp who were wondering why Smith, Levenick and others were promoting Stephenson during the election. Let's just say that the ends justified the means for both camps. It worked for Stephenson to team with former mayor and council, but now you know and let us not be so foolish come May 2012.

Anonymous said...

So I guess all of that talk about them "never" talking to Smith was a bunch of BS then.