Last year the 14th Court of Appeals in Houston issue an opinion that should serve as a warning to mineral owners, Thistle Creek Ranch v. Ironroc Energy Partners, No. 14-20-00347-CV.
Thistle Creek sued IronRoc to terminate an oil and gas lease it claimed had expired for lack of production in paying quantities. The lease is on a form I have seen before. The habendum clause provides:
Unless sooner terminated or longer kept in force under other provisions hereof, this lease shall remain in force for a term of three (3) years from the date hereof, hereinafter called “primary term,” and as long thereafter as operations, as hereinafter defined, are conducted upon said land with no cessation for more than ninety (90) consecutive days.