Supreme Court
Cromwell v. Anadarko E&P Onshore, LLC
- Case number: 23-0927
- Legal category: Oil and Gas
- Subtype: Lease Termination
- Set for oral argument: February 18, 2025
Case Summary
This case requires the interpretation of an oil-and-gas lease habendum clause.
David Cromwell and Anadarko are oil-and-gas co-tenants, both owning fractional shares of the working interest on the same acreage in Loving County. The habendum clauses of Cromwell’s leases maintained his interest for “as long thereafter as oil, gas or other minerals are produced from said land.” Cromwell submitted his leases to Anadarko, the operating tenant, and requested to participate in its production, but Anadarko never responded. After one well reached payout, Anadarko sent Cromwell monthly “Joint Interest Invoices” that allocated production revenues and expenses to Cromwell. Years after the expiration of the leases’ primary terms, Anadarko informed Cromwell that it believed his leases terminated at the end of their primary terms because he failed to enter a joint-operating agreement.
Cromwell sued Anadarko for declaratory relief, trespass to try title, and other claims. Both sides moved for summary judgment. After concluding that the leases had terminated, the trial court granted Anadarko’s motion and denied Cromwell’s. The court of appeals affirmed. Relying on its own precedent, the court held that Cromwell’s leases terminated because he did not cause the production of oil or gas on the land.
Cromwell petitioned the Supreme Court for review. He argues that the plain language of the habendum clauses is satisfied because, at all relevant times, production in paying quantities has occurred on the acreage; thus, the leases have not terminated. The Court granted the petition.
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