Pan American Petroleum Corporation v. O'BIER

201 So. 2d 280, 27 Oil & Gas Rep. 483, 1967 La. App. LEXIS 4965
CourtLouisiana Court of Appeal
DecidedJune 30, 1967
Docket10829
StatusPublished
Cited by6 cases

This text of 201 So. 2d 280 (Pan American Petroleum Corporation v. O'BIER) 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
Pan American Petroleum Corporation v. O'BIER, 201 So. 2d 280, 27 Oil & Gas Rep. 483, 1967 La. App. LEXIS 4965 (La. Ct. App. 1967).

Opinion

201 So.2d 280 (1967)

PAN AMERICAN PETROLEUM CORPORATION et al., Plaintiffs-Appellees,
v.
Tilon M. O'BIER et al., Defendants-Appellants.

No. 10829.

Court of Appeal of Louisiana, Second Circuit.

June 30, 1967.
Rehearing Denied July 27, 1967.

*281 Campbell, Campbell & Marvin, Minden, for defendants-appellees, Group A defendants.

Riley B. Fell, Tulsa, Okl., for defendant, Marathon Oil Co.

Paul A. Newell, Haynesville, for defendants-appellants, Haynesville Mercantile Co., C. E. Miller, Claude Beene, Heirs of Mrs. Jodie Lewis.

Lowe & Benton, Minden, curator ad hoc representing W. L. Wright and Frances McInnis Crumpton, for appellees.

Stewart & Stewart, Minden, for John E. Ashby and Frank C. Ashby.

Simon, Carroll, Fitzgerald & Fraser, Shreveport, for plaintiffs-appellees.

Before HARDY, GLADNEY and AYRES, JJ.

HARDY, Judge.

This is a concursus proceeding seeking judicial distribution between opposing claimants of funds from oil and gas production attributable to tracts of land in Webster Parish included in production units established by the Department of Conservation with particular reference to *282 the present production of oil from what is known as the Mitchell Unit Well.

Petitioners, operators of the Mitchell Well, named as defendants two groups of opposed claimants to mineral rights in the described property. The Group A defendants, Theron J., Tilon M. O'Bier and Vertie M. O'Bier Miller, are owners of the fee title to the property and claim ownership of all the minerals therein. The Group B defendants, J. F. O'Bier, the eight heirs of Jettie O'Bier Lewis, Claude Beene, C. E. Miller, W. L. Wright, Frances McInnis Crumpton, F. C. and John Ashby, Haynesville Mercantile Company and Marathon Oil Company, were alleged to be claimants of fractional interests deriving from sales or reservations of mineral rights.

From judgment recognizing the Group A defendants as owners of all minerals, some, though not all, of the Group B defendants have appealed. Specifically the appellants before the Court are Haynesville Mercantile Company, C. E. Miller, Claude Beene, and the eight heirs of Lewis.

Although plaintiffs instituted this suit for the purpose of fixing the distribution of funds attributable to a 20 acre tract of land described as the E½ of NW ¼ of SE ¼ of Section 31, Township 23 N., Range 9 W., Webster Parish, Louisiana, the suit involves, and the judgment decrees the ownership of the minerals in tracts of land aggregating 160 acres and particularly described as:

Northeast ¼ of Northwest ¼, Southeast ¼ of Northwest ¼, less 20 acres in a square in the Southwest corner, West ½ of Northeast ¼ and East ½ of Northwest ¼ of Southeast ¼ of Section 31, Township 23 North, Range 9 West, Webster Parish, Louisiana.

The essential facts, undisputed by the parties, may be briefly narrated. In 1919 H. B. O'Bier executed an oil and gas lease covering the tract of 160 acres in Section 31, of which he was the sole owner, which lease was acquired by the Texas Company through assignment. Subsequent to the execution of the lease O'Bier made several sales of mineral interests in various portions of the 160 acre tract. In September, 1923, the Texas Company completed a gas well located in the Northeast Quarter of the Northwest Quarter of Section 31, producing approximately fifty million cubic feet of gas per day. This well is the only operation or production that has ever been undertaken on any part of the 160 acre tract of land.

In December, 1923, the Texas Company and all of the then mineral owners executed an amendment to the original lease with reference to the gas royalty provision which, insofar as pertinent to this litigation, reads as follows:

"2nd. To pay the lessors at the rate of Two Hundred ($200.00) Dollars per annum, payable quarterly, for each well producing gas in paying quantities, but not producing oil in paying quantities, and from which gas is not being used, or sold, off the land, but when and while such gas is being used, or sold, off the land by lessee, the same shall be metered and lessors shall be paid one-eighth (1/8th) of two cents (2¢) per thousand (1,000) cubic feet, corrected to two (2) pounds above atmospheric pressure, for the gas so used or sold off the land, and lessors shall have the privilege, at lessors' risk and expense of making connections and using gas from such wells free of charge for one dwelling on the land, such connection, where meter is installed, shall be between the wells and the meter; * * *."

(Emphasis supplied)

Prior to 1930 H. B. O'Bier and his wife, Sarah, died intestate leaving as their heirs seven children and four children of a predeceased *283 daughter who inherited the fee title to the property together with the unsold mineral interests in various portions of the 160 acres of land.

There were numerous sales involving the fee title as well as sales and reservations of fractional interests in the minerals of various tracts of land prior to the year 1936, by which time P. E. O'Bier had acquired the fee title to the entire 160 acres of land which was inherited by the Group A defendants, as owners, on the death of P. E. O'Bier in 1955.

Production of gas from the Texas Company well continued in decreasing amounts from the time of its completion in 1923 until August of 1939 when the pipeline connections with the well were removed and the well was capped. After August of 1939 no gas was sold from the well off the premises, but from September 1, 1939, to September 1, 1957, the Texas Company paid, or offered to pay, a shut-in royalty of $200.00 per annum to the various mineral owners. After 1948 P. E. O'Bier refused to accept payment of this shut-in royalty, although he continued to use gas for the service of his residence located on the leased tract up until the time of his death in 1955.

By instrument dated March 19, 1932, executed by the Texas Company and the mineral owners, the said company released all leasehold rights in and to all of the property included in the original lease of September 4, 1919, with the exception of the 40 acre tract of land (NE ¼ of NW ¼ of Section 31) upon which the Texas Company gas well was located, from which gas was then being sold off the premises. The Texas Company formally surrendered and cancelled all rights with respect to its lease on this 40 acre tract in 1957.

In the years from 1947 to 1949, through assignment of leases and co-lessor agreements, petitioners in this action became the owners of the mineral leasehold rights on all of the land except the 40 acre tract covered by the Texas Company lease.

Although there have been no drilling operations on any of the lands involved, with the exception of the Texas Company well of 1923, operations resulting in production have been conducted on adjacent lands with which portions of the subject property were unitized. In 1950 a well known as the Mitchell Well was completed as a gas producer on the NE ¼ of SE ¼ of Section 31, which was subsequently unitized by order of the Department of Conservation with portions of the subject lands and was known as the Mitchell Gas Unit. In 1951 a well was drilled and completed as a gas producer located in the NW ¼ of SW ¼ of Section 31, which property was unitized by order of the Department of Conservation with a portion of the subject land, which well was known as the O'Bier Gas Unit.

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Bluebook (online)
201 So. 2d 280, 27 Oil & Gas Rep. 483, 1967 La. App. LEXIS 4965, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pan-american-petroleum-corporation-v-obier-lactapp-1967.