Home-Stake Production Company v. Minnis

1968 OK 57, 443 P.2d 91
CourtSupreme Court of Oklahoma
DecidedApril 23, 1968
Docket41955
StatusPublished
Cited by6 cases

This text of 1968 OK 57 (Home-Stake Production Company v. Minnis) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Home-Stake Production Company v. Minnis, 1968 OK 57, 443 P.2d 91 (Okla. 1968).

Opinion

BLACKBIRD, Justice.

The action involved in this appeal was based upon a contract pertaining to the development of certain oil properties in the Seminole Field. This Field was the result of the discovery, in the early part of the decade, between 1920 and 1930, that the Wilcox Sand, which lies at a depth of approximating four thousand feet in much of Seminole County, was a prolific producer of oil. Much of the field’s initial, or primary, development and production occurred prior to the enactment of most of this State’s present oil and gas conservation laws, and many of its original producing leases have, in the past 20 years, quit *94 producing and have been abandoned with little, if any, use of the more modern methods and sophisticated techniques which, in later years, have come into common use in drilling and completing oil and gas wells, and developing oil and gas leases. In more recent years, it has been determined that much oil, left in place under those leases when their wells quit pumping, can be recovered by present-day methods; and several lessees have been successful in what has been termed “secondary recovery” or “secondary development” programs.

During a period of some months before the year 1963, plaintiff in error, hereinafter referred to as “defendant”, became interested in launching its own secondary recovery program in Seminole County and was considering the purchase, for that purpose, of leases held by Petroleum Consultants Inc., hereinafter referred to as “PCI”. Accordingly, its President, Mr. Trippett, enlisted the aid of two consulting geologists who appear here as defendants in error (and will hereinafter be referred to by name or as “plaintiffs”) in this program. The terms and conditions under which plaintiffs would assist defendant were set out in a letter dated January 17, 1963, drafted and signed by Trippett, (who had been a practicing lawyer) and accepted by plaintiffs, at a conference with him in defendant’s Tulsa office. The letter, other than its formal parts, reads as follows:

“This will set forth our arrangement as follows:
“1. We are now looking at acreage owned by PCI in Seminole County, Oklahoma, where Bill Doenges has a ⅛ override after payout. PCI may want to sell this acreage. You will make a recommendation' to us as to whether we should acquire the acreage. If you recommend that we not acquire it, then we will pay you $50 per day for the time you have spent in determining what your recommendation will be. If you recommend that we acquire it, we still may not acquire it because of the unfavorable lease situation, but if you recommend that we acquire it and you do any more work for us you will be paid $50 a day for such additional work.
“2. If we do acquire the acreage then you will do additional geological work, both in the office and in the field for us. The office work shall be at the rate of $50 per day and the field work shall be as follows: Up to 3 hours, $25.00; up to 6 hours, $50.00; up to 9 hours, $75.00; 9 to 24 hours, $100.00,
“3. If you recommend that we acquire additional acreage surrounding the Doenges acreage and we do acquire it, you will be entitled to an overriding royalty interest of ½6 of ⅝ on such additional acreage if we go ahead and acquire such other acreage without other overriding royalty interests. If we have to pay other overriding royalty interests to acquire the acreage, then such other overrides shall be deducted from your override, all to the end that the acreage shall not be burdened with a total override of more than Vm of ⅜.
“4. It is understood that if we acquire the Doenges acreage we will guarantee you a niminum of $2,500 worth of work.
“5. We already own acreage at Cromwell and Searight in Seminole County, Oklahoma. We shall have the right to call on you for office and field work in connection with those projects. We will pay you $50 per day for office work and field work shall be paid for on the same schedule as set forth above.
<<⅜ * *
“7. It is also understood that we want to acquire additional projects in the Seminole area. If you recommend them to us and we acquire them, we will pay you $50 a day for office work you did leading up to the recommendation and acquisition. Furthermore, you will get the same overriding royalty interest basis as outlined above on acquired acreage. Further, after we acquire such projects, we will expect to call on you for addi *95 tional field and office work and it will be at the same rates as set forth above.
“In doing office work you may have to order maps, logs, etc., and you shall be entitled to charges for your actual out-of-pocket expenses in that connection. In field work you shall be entitled to charges for your travel expenses in addition to the per diem rates set forth above.” (Emphasis added.)

Thereafter, plaintiffs,' after studies of areas lying in different directions from the PCI acreage, recommended defendant’s purchase of leases in what came to be referred to as the “Susie”, “Gold Creek”, “Mission”, and “Little River” projects. During the months of February, March and April, 1963, Seminole County lease and royalty brokers, Herman A. Bishop and W. J. Haning, assisted defendant in the acquisition of oil and gas leases with primary terms of two and three years, on almost 4,000 acres of Seminole County land for these 4 projects.

After a preliminary report concerning those leases earlier that month, plaintiffs addressed a written report, dated April 25, 1963, to Mr. Frank Sims, senior Vice-President of the defendant Company, recommending in rather specific detail, recompletion and testing procedures for a well known as the “A-l Rascoe”, on the Rascoe lease, and drilling procedures for another well to be known as the “0-2 McDonough” well on the McDonough lease, both of which leases were a planned part of the defendant’s Susie project. Some of these procedures were not thereafter followed, due largely to differences of opinion, and perhaps a clash of personalities, between Mr. Carl Weatherford, defendant’s petroleum engineer, and one or both of the plaintiffs. Plaintiffs complained of this in a long distance call to Mr. Trippett, who was then in New York, early in June; and then, after Trippett returned to Tulsa, they addressed a letter to him dated June 12, 1963, on the same subject.

Previously, on June 6th, Mr. Sims had cancelled previous assignments of work that plaintiffs had been given to do for defendant, with the exception of a map of the Searight pool, which plaintiff Hill was to furnish, and the making of a copy of a field study map of the Bowlegs field that plaintiff Minnis was to submit. Previous to an appointment, they had obtained to confer with Mr. Trippett at his office in Tulsa on July 12, 1963, plaintiffs wrote him a letter, dated July 8th, requesting a list of all of the leases defendant had purchased on their recommendations and also requesting that they be delivered assignments of overriding royalty under them, in accord with the hereinbefore quoted letter-agreement dated January 17, 1963. After plaintiffs’ Tulsa conference with Mr.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Florafax International Inc. v. GTE Market Resources, Inc.
1997 OK 7 (Supreme Court of Oklahoma, 1997)
Dixon v. Roberts
1993 OK CIV APP 15 (Court of Civil Appeals of Oklahoma, 1993)
Miles v. Young
1991 OK CIV APP 101 (Court of Civil Appeals of Oklahoma, 1991)
Bullard's Oil Field Service, Inc. v. Williford Energy Co.
775 P.2d 802 (Supreme Court of Oklahoma, 1989)
Wetsel v. Independent School District I-1
1983 OK 85 (Supreme Court of Oklahoma, 1983)
Perry v. Lawson Ford Tractor Co.
1980 OK 90 (Supreme Court of Oklahoma, 1980)

Cite This Page — Counsel Stack

Bluebook (online)
1968 OK 57, 443 P.2d 91, Counsel Stack Legal Research, https://law.counselstack.com/opinion/home-stake-production-company-v-minnis-okla-1968.