AcadiEnergy, Inc. v. McCORD EXPLORATION

596 So. 2d 1334, 1992 WL 6825
CourtLouisiana Court of Appeal
DecidedJanuary 14, 1992
Docket90-595
StatusPublished
Cited by9 cases

This text of 596 So. 2d 1334 (AcadiEnergy, Inc. v. McCORD EXPLORATION) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
AcadiEnergy, Inc. v. McCORD EXPLORATION, 596 So. 2d 1334, 1992 WL 6825 (La. Ct. App. 1992).

Opinion

596 So.2d 1334 (1992)

ACADIENERGY, INC., et al., Plaintiffs-Appellees,
v.
McCORD EXPLORATION COMPANY; McCord 1984 Exploration Fund Partnership; Charles T. McCord, III; and Westover Oil Company, Defendants-Appellants.

No. 90-595.

Court of Appeal of Louisiana, Third Circuit.

January 14, 1992.

*1335 Brook, Morial, Cassibry & Pizza, H. Dillon Murchison and Norman F. Pizza, New Orleans, for plaintiffs/appellees.

Lapeyre, Terrell & Randazzo, F. Henri Lapeyre, Jr., David W. Rusch, and Matthew J. Randazzo, III, New Orleans, for defendants/appellants.

Before DOMENGEAUX, C.J., and GUIDRY and KING, JJ.

*1336 KING, Judge.

The issues presented for decision by these consolidated appeals are (1) whether a drilling agreement provided for a well cost adjustment upon subsequent revisions to the unit originally established by the Louisiana Office of Conservation, (2) whether La.R.S. 30:10 is applicable; (3) whether there was error in the calculation of the amount due for a well cost adjustment; (4) the date from which interest on a well cost adjustment should accrue for such well cost adjustment; (5) whether interest on a judgment should accrue from the date of judicial demand; (6) whether plaintiff forfeited its interest in an oil well under the terms of a joint operating agreement; (7) whether the trial court erred in refusing to amend the judgment or grant a new trial in order to correct mathematical errors in an amount stipulated to at trial; and (8) whether the trial judge erred in awarding interest on a stipulated amount from the date of judicial demand.

Plaintiff, AcadiEnergy, Inc. (hereinafter AcadiEnergy) filed three different suits against various defendants based on a Drilling Agreement and Joint Operating Agreement between the parties. In this suit, our Docket Number 90-595, AcadiEnergy filed a petition against Westover Oil Company (hereinafter Westover), McCord Exploration Company and McCord 1984 Exploration Fund Partnership, seeking recognition of a certain percentage ownership of a mineral interest and recovery of revenues allegedly due for the McCord-Helis No. 2 Well (hereinafter the McCord-Helis No. 2 Well) attributable to certain producing sands. In the consolidated suit, entitled AcadiEnergy Inc. v. McCord Exploration Company, 596 So.2d 1344 (La.App. 3 Cir. 1992), AcadiEnergy filed a petition against Westover, McCord 1984 Exploration Fund Partnership and Charles T. McCord, III for well cost adjustment expenses for drilling and completing the AcadiEnergy-Tucker No. 1 well (hereinafter the Tucker Well) and for unpaid operating expenses for the Tucker Well. In the other consolidated suit, entitled AcadiEnergy, Inc. v. Westover Oil Corporation, 597 So.2d 1 (La.App. 3 Cir.1992), plaintiff filed a petition against Westover, McCord Exploration Company, McCord 1984 Exploration Company, and McCord 1984 Exploration Fund, Ltd. (all McCord groups are hereinafter collectively referred to as McCord), seeking recognition of a certain percentage ownership of a mineral interest and recovery of revenues allegedly due for the McCord-Helis No. 1 well (hereinafter the Helis Well).

Defendants filed an answer in each suit denying plaintiff's allegations and a reconventional demand in the latter suit alleging that AcadiEnergy had forfeited its interest in the Helis Well and seeking judgment to require AcadiEnergy to assign its interest in the Helis Well to defendants. These three lawsuits were consolidated for trial in the trial court and remain consolidated on appeal. As the three suits involve substantially the same facts and applicable law, all three suits will be discussed in this opinion rendered in the first consolidated appeal, our Docket Number 90-595, but we will render a separate judgment in the consolidated appeals. Plaintiffs then filed a Consolidated Supplemental, Amending, and Restated Petition in the three consolidated suits and Westover and McCord then filed an Answer to the Restated Petition and a Consolidated, Supplemental, Amending, and Restated Reconventional Demand. Defendants' Restated Reconventional Demand in each consolidated suit alleged that AcadiEnergy had improperly billed defendants for certain operating costs on the Tucker Well and sought recovery for the amounts allegedly improperly withheld by AcadiEnergy from production on the Tucker Well.

Defendants complied with AcadiEnergy's demands in the first suit for amounts due on the McCord-Helis No. 2 well, so the issues in that suit were not tried by the district court and are not before us. A trial was held on the merits of the remaining two suits and, at the conclusion of the trial, the trial judge rendered oral reasons *1337 for judgment ruling in favor of AcadiEnergy and against defendants ordering a well cost adjustment on the Tucker Well, in favor of AcadiEnergy and against defendants ordering an assignment of defendant's interest in the Helis Well and payment of production from the Helis Well due to AcadiEnergy, and in favor of defendants and against AcadiEnergy on the reconventional demand for certain operating costs improperly withheld from the Tucker Well production. A formal written judgment was signed. All defendants timely suspensively appealed. After the consolidated appeals were lodged in this Court, all of the McCord defendants compromised and settled their differences with AcadiEnergy and filed a motion to dismiss their appeals. Thus, only the claims of Westover remain for resolution on these appeals. Westover has specified eight assignments of error. We reverse the trial court judgment awarding a well cost adjustment to AcadiEnergy on the Tucker Well and affirm the trial court judgment in all other respects.

FACTS

AcadiEnergy, Westover, and McCord executed a Drilling Agreement and Joint Operating Agreement effective March 20, 1984. The purpose of these agreements was to explore and develop oil and gas attributable to certain acreage above the Iberia Salt Dome that each party leased and which was contiguous. Under these agreements an initial well was to be drilled. These agreements provided that they were "limited to the management and operation of the acreage encompassed within the unit formed for the initial well and is limited also to a depth of one hundred feet below such unitized sand, which area shall be referred to as `Contract Area.'" The "initial well" to be drilled was the Tucker Well.

TUCKER WELL

On May 23, 1984, AcadiEnergy, as operator, commenced operations for the drilling of the initial well, the AcadiEnergy-Helis No. 1 well, later renamed the AcadiEnergy Tucker No. 1 well. The Tucker Well was completed and began producing in the late summer of 1984.

By Office of Conservation Order Numbers 860-0-1 and 860-K-1, effective August 22, 1984, the Commissioner of Conservation agreed to establish the geographic unit for the Tucker Well suggested by the parties for the exploration and production of oil and gas from the MA-2 RB SUA (hereinafter MA-2 sand) and MA-3 RB SUA (hereinafter MA-3 sand) sands, respectively. The parties were required to present additional geological information within six months in order to better establish the geology of the area. After obtaining additional geological data, the Commissioner of Conservation revised the old unit and created a new unit by Order Numbers 860-0-2 and 860-K-2. These new orders were effective on September 25, 1985. The Commissioner of Conservation further revised the unit again by Order Numbers 860-0-3 and 860-K-3 and these new orders were effective on July 8, 1986.

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Bluebook (online)
596 So. 2d 1334, 1992 WL 6825, Counsel Stack Legal Research, https://law.counselstack.com/opinion/acadienergy-inc-v-mccord-exploration-lactapp-1992.