Louisiana Statutes
§ 31:124 — Production in paying quantities required; definition
Louisiana·Title 31 Motor Vehicles and Traffic Regulation
When a mineral lease is being maintained by production of oil or gas, the production must be in paying quantities. It is considered to be in paying quantities when production allocable to the total original right of the lessee to share in production under the lease is sufficient to induce a reasonably prudent operator to continue production in an effort to secure a return on his investment or to minimize any loss.
As to all other minerals, it is sufficient if a reasonably prudent operator would continue production considering the particular circumstances in the light of the nature and customs of the industry involved. In appropriate cases, such as the mining of lignite, a court may consider the total amount of production allocable to the mining plan or project of which a particular lease i
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Related
Edmundson Bros. v. Montex Drilling Co.
731 So. 2d 1049 (Louisiana Court of Appeal, 1999)
B.A. Kelly Land Co., L.L.C. v. Questar Exploration & Production Co.
106 So. 3d 181 (Louisiana Court of Appeal, 2012)
Gloria's Ranch, L.L.C. v. Tauren Exploration, Inc.
223 So. 3d 1202 (Louisiana Court of Appeal, 2017)
Barham v. St. Mary Land & Exploration Co.
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Treme v. St. John the Baptist
93 F.4th 792 (Fifth Circuit, 2024)
Edmundson Bros. Partnership v. Montex Drilling Co.
672 So. 2d 1061 (Louisiana Court of Appeal, 1996)
Legislative History
Acts 1974, No. 50, §124, eff. Jan. 1, 1975. Amended by Acts 1976, No. 129, §1.