Tank v. Citation Oil & Gas Corp.

Defendants Citation Oil & Gas Corp., Petro-Hunt LLC, and other working interest owners appealed a district court summary judgment quieting title to an oil and gas lease in Greggory Tank. In 1982, George and Phyllis Tank executed an oil and gas lease in favor of Petro-Lewis Funds, Inc. The parties agreed to extend the primary term of the lease for three more years, ending July 15, 1989. In May 1983, the Tank 3-10 well was spudded in the northwest quarter. The well produced until October 1996. In June 1998, the Tank 3-10R well was spudded and replaced the Tank 3-10 well. The Tank 3-10R well continues to produce oil or gas. In June 1988, the Tank 13-10 well was spudded in the southwest quarter. The well continuously produced oil or gas until October 2008, and intermittently produced oil or gas until January 2012. Tank was the successor in interest to George and Phyllis Tank and was the owner of minerals in the southwest quarter of section 10. In September 2011, Tank sued the defendants, seeking to cancel the oil and gas lease to the extent it covered the southwest quarter. The defendants moved for summary judgment, seeking dismissal of all of Tank's claims. The defendants argued the continued drilling and operation of oil and gas wells on the leased property maintained the lease beyond the primary term and the lease remained in full force and effect. The district court denied the defendants' motion for summary judgment, ruling the lease had expired and was no longer valid on the southwest quarter. The court determined summary judgment was appropriate because there were only issues of law to resolve, including the interpretation of an unambiguous contract and the application of undisputed facts. Finding no reversible error in the district court's decision, the Supreme Court affirmed. View "Tank v. Citation Oil & Gas Corp." on Justia Law